Sonic Strategy (SWOT)

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tw TABLE OF CONTENTS PHASE I Company Analysis SWOT Analysis TOWS Matrix PHASE I General Company Information General Internal Analysis Core Competence Assessment Industry and Competitive Analysis Value Analysis Industry Analysis SPACE Chart / Analysis Competitive Analysis PHASE II Strategic Analysis & Choice Porter's Five Forces Strategic Alternatives and Analysis Strategic Group Map PHASE III Recommendations GE Matrix Recommendations Market Analysis Mission Statements Environmental Analysis Vision Statements SAM tw = Strategic Analysis Model that works Financial Analysis--This module is contained in separate files on the SAM tw CD-Ro Print Cover Page Go To Input Print All Industry and Competition Print Industry Go To Input Print Comp Go To Input Print Porter Go To Input Print GE Matrix Go To Input Print Market Go To Input Print Environmenta l Go To Input Print All Company Analysis Output Print SWOT Go To Input Print Internal Go To Input Print SPACE Go To Input Print Strategy Go To Input Print Recommendati ons Go To Input Print Mission Go To Input Go To Input Print Value Print SGM4 Go To SGM5 Print Mission Go To Input Print ALL Strategy Output Worksheets Go To SGM4 Go To SGM6 Print All Recommendations Output Print SGM5 Print SGM6 Print TOWS Go To Input Print CC Go To Input

description

Strategy Template with SWOT Analysis filled in.

Transcript of Sonic Strategy (SWOT)

Page 1: Sonic Strategy (SWOT)

tw

TABLE OF CONTENTS

PH

AS

E I

Company Analysis

SWOT Analysis

TOWS Matrix

PH

AS

E I

General Company Information General Internal Analysis

Core Competence Assessment

Industry and Competitive Analysis Value Analysis

Industry Analysis SPACE Chart / Analysis

Competitive Analysis

PH

AS

E I

I Strategic Analysis & Choice

Porter's Five Forces Strategic Alternatives and Analysis

Strategic Group MapP

HA

SE

III

Recommendations

GE Matrix Recommendations

Market Analysis Mission Statements

Environmental Analysis Vision Statements

SAM tw = Strategic Analysis Model that works

Financial Analysis--This module is contained in separate files on the SAM tw CD-Rom.

Print Cover PageGo To Input

Print All Industry and Competition

Print IndustryGo To Input

Print CompGo To Input

Print PorterGo To Input

Print GE Matrix

Go To Input

Print MarketGo To Input

Print EnvironmentalGo To Input

Print All Company Analysis Output

Print SWOTGo To Input

Print InternalGo To Input

Print SPACEGo To Input

Print StrategyGo To Input

Print Recommenda

tionsGo To Input

Print MissionGo To Input

Go To Input Print Value

Print SGM4

Go ToSGM5

Print MissionGo To Input

Print ALL Strategy Output Worksheets

Go To SGM4

Go To SGM6

Print All Recommendations Output

Print SGM5

Print SGM6

Print TOWSGo To Input

Print CCGo To Input

L6
Financial Analysis is contained in separate modules on the SAM-tw CD-Rom. Use the Launch Pad to open them or simply look for them on the CD-Rom. There is a separate file for either 3, 4, or 5 years of financial data.
C15
There is a separate Strategic Group Map for either 4, 5, or 6 groups. Choose the appropriate sheet for your particular industry / company's situation.
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tw

Strategy Toolbox Checklist

PHASE I: Situation Analysis

General Company Information

Industry and Competitive Analysis

Industry Analysis

Competitive Analysis

Porter's Five Forces

Strategic Group Map

GE Matrix

Market Analysis

Environmental Analysis

Company Analysis

Financial Analysis

SWOT Analysis

TOWS Matrix

General Internal Analysis

Core Competence Assessment

Value Analysis

SPACE Chart / Analysis

PHASE II: STRATEGIC ANALYSIS AND CHOICE

Strategic Alternatives and Analysis

PHASE III: RECOMMENDATIONS

Recommendations

Mission Statements

Vision Statements

SAM tw = Strategic Analysis Model that works

Indicate which tools are appropriate for completing a Strategic Plan for this company. Indicate completion for tools used, and space is allowed to record comments regarding any of the tools.

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Once input is complete for this screen, click here to print Cover Sheet which incorporates the data entered here.

Input General Company Information

Sporting Goods - Retail Name of Company Your Company Name

Segment

Industry

Number of Employees

Products/Services

CEO Name

CEO Style

No. Years in Business

No. Locations

How Many States/Countries?

Headquarters Location

Public or Privately Held?

Parent Corporation/Company

Stock Price Range (12 Mo)

Ticker Symbol

Strategy Designer

Publicly Held Privately Held

C4
Write in the name of the company being analyzed here.
C5
Industries are typically divided into segments that are highly related to one another. The entertainment industry, for example, is divided into segments of radio, TV, movies, movie-theaters, pro sports, concerts, theaters, cabarets, etc. Insurance has segments of auto, health, dental, whole/universal life, housing, commercial, marine, earthquake, etc. The key is to label the segment in which the company competes accurately and precisely. Sometimes, you will have to label the segment yourself, i.e., there is no recognized label in existence. If a company does compete in a segment, it's OK later to refer to it as "the industry." Whatever it's ultimately called, it's the arena in which the company competes.
C6
This is the general name given to the category in which you and your rivals compete, for example, auto, health care, leisure products, entertainment, defense, aerospace, general manufacturing, etc. A more specific label usually connotes the segment in which the company competes. An industry (or segment) is defined as the collection of competitors who produce similar or substitute products or services to a defined market.
C9
Stands for Chief Executive Officer. If there isn't one in the company, write in the name of the president.
C10
How would you characterize the CEO's style? Write in 3-5 adjectives that best describe it, e.g., aggressive, democratic, ambitious, knowledgeable, caretaker, charismatic, personable, etc.
C11
Write in how long the company has been in business, if you know it.
C12
How many locations does the company have? You might break this down by number of manufacturing plants, number of sales offices, number of warehouses, etc. For multidivisional companies, count the locations of all subsidiaries and divisions.
C16
Complete this only if the company in question is a division or subsidiary of a parent corporation.
C17
Complete this only for a public company.
C18
This is the trading symbol for publicly held companies.
C19
This is you. Write your name here.
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Your Company Name

Industry Snapshot

Total Industry or Segment Sales ($M)

Industry or Segment Growth Rate (%/yr)

Lifecycle Stage Degree of Vertical Integration Degree of Technological Innovation

Scale Economies Industry Profitability Degree of Concentration

Industry Driving Forces

Industry Attractiveness Matrix

Factors Weight Rating Product

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0

0.0

This index indicates that this is NOT an attractive industry to enter or remain in.

IndustryAttractiveness

Index

PURCHASING

MANUFACTURING

DISTRIBUTION

ADVERTISING

B10
Industries have lifecycle curves similar to products, divided into 5 major lifecycle stages. "Emerging" characterizes an industry before market acceptance of its product. Once a market is established, it enters a "growth" period when demand exceeds supply and other competitors enter the industry. Growth wanes when supply exceeds demand, customers are harder to find and prices drop. Weak competitors fail or are acquired by stronger ones during a period called "shakeout." When growth drops to 5% or less, the industry is said to be "mature." With negative growth rates year after year, the industry is said to be in "decline." In what lifecycle stage is this industry?
D10
Being vertically integrated means controlling at least one additional stage of the value chain. Vertical integration also means either making what you used to buy, or buying a supplier (backward vertical integration), or competing with or acquiring a customer (forward vertical integration). For this industry, state your perception of the extent of vertical integration in the industry by selecting one of the choices listed.
F10
Estimate the extent to which the industry depends on technological innovation for its growth, and the extent to which technological innvovation forms the basis of competition in the industry. Choose one of the descriptors here that best describes the situation in your industry.
B13
Some industries are able to achieve scale economies, i.e., to lower unit manufacturing, purchasing, and distribution costs as volume increases. Is this one of them? Enter all areas in which companies in the industry are achieving scale economies.
D13
This refers to the average profitability of the industry or segment, as measured by return on sales (NIAT/revenues) expressed as a percentage. Industries with fairly high average profitability typically have bargaining power over their suppliers and customers, while those with low average profitability do not. The former contain companies with highly differentiated products, while the latter's products are more like commodities. Choose one of the listed ranges that best describes your industry.
F13
When a large proportion of an industry's sales are produced by a small number of companies, the industry is said to be concentrated, e.g., the Big Six accounting firms auditing over 95% of all U.S. public companies, or Boeing and Airbus Industrie being the only manufacturers of large commercial aircraft in the world. At the other extreme, a fragmented industry is one in which no competitor holds more than 0.5% market share. A moderately concentrated industry is somewhere in between, e.g., where ten competitors account for 50% of industry sales. Estimate how concentrated your industry is.
B18
Driving Forces are factors that cause the industry to change. Examples include: Changes in the industry growth rate Changes in buyers or uses of the product Product/marketing innovations Entry or exit of major firms Increasing globalization Buyer preferences for differentiation Changes in regulation or government policies Changing societal concerns, attitudes, lifestyles Reductions/increases in uncertainty and risk
A25
Industry attractiveness depends on several factors. To help you identify these factors, imagine the ideal industry you would like to be in or enter, e.g., large market, high industry growth, no regulation, little competition, low or high entry barriers if outside or inside the industry, and high profitability. With such factors in place, one could then assess the attractiveness of a particular industry by weighting the factors (allocating 100 points among them--the weights will be automatically totaled), and rating them from your company's point of view (between 0-1.0, 1.0 being highest). The weights will be multiplied automatically by the ratings in the last column, and the last column totaled automatically to give an I.A. index (%).
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Your Company Name

Competitive Analysis: Snapshot of the Competition

Type of Competition Basis of Competition

Enter Market Share Data

Your Company Name 0%

Competitor 1 0% `

Competitor 2 0%

Competitor 3 0%

Competitor 4 0%

Competitor 5 0%

Others 0%

0%

Are Market Shares Stable or Changing?

CRITICAL SUCCESS FACTORS

Name 5 Success Factors

Total (should = 100) 0

Competitor Analysis for Critical Success FactorsScore companies on a scale of 1 to 10 for relative strength for each factor (10 indicates greatest/highest level)

Factor Your Company Name Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5

0

0

0

0

0

ADDITIONAL COMPETITIVE DATA

Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5

Strategic Factor Your Company Name Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5

Competitive Advantage

Strategic Intent

Geographic Scope

Positioning

Generic Strategy

Print after input is complete for this screen

Weight each item (sum should be 100)

Name up to 2 things each competitor does better than Your Company Name

Name up to 2 things that Your Company Name does better than each competitor

Make sure to input names of competitors here. They are used in numerous instances within the model.

A8
Choose from among: Monopoly--the only competitor in the business (true if first to market, or if granted an exclusive territory) Duopoly--only two competitors in the industry Oligopoly--a small number of independent rivals Monopolistic Competition--a small number of rivals having strongly differentiated and branded products Monopsony--a monopoly on the buyer's side, i.e., the whole industry serving one customer Pure Competition--a large number of competitors.
E8
You may choose from the following, or indicate one that is more appropriate for your company: Price--typical in commodity industries, or where people sacrifice quality or service for a lower price Quality--where people will pay more for higher perceived quality Service--where customers go because of how well they're treated Technology--where advantages accrue through superior technology or patents Low-Cost Leadership--power through having the lowest costs in the industry.
A11
Market share is calculated typically using total dollar sales in the industry, taking into account not only number of units sold but also their price. Sometimes, market share is calculated on a different basis, e.g., number of screens in the movie-theater industry, or installed base in the telecommunications-switching industry, or # beds in hospitals. Enter top five competitors below your company and market share percentages.
A22
Is there a competitor rapidly gaining market share? Is the market-share gap between established competitors growing or shrinking? Is a rival making a concerted bid for market share?
A26
A critical success factor in an industry is something a company must do well in order to succeed in the industry. They attach to an industry and not to a company. Think of these as "rules of the game" for a particular industry. Every industry has its own rules, which a company must "play by" if it wants to succeed in the industry.
A55
A competitive advantage is an edge over your competitors that your company possesses. It could take the form of a proprietary product or process, a developmental lead-time, or a discipline or level of service that cannot easily be emulated. Companies that have a core competence usually have a sustainable competitive advantage. A competitive advantage can erode over time if the company does not work at sustaining it.
A56
This has to do with market shares and changing or defending your ranking in the industry. For example, if you are the market leader, you should maintain your leadership position; if not the leader, you might want to overtake the leader, or overtake #4 from #5, or maintain your #2 position, or defend against #8 who is creeping up to challenge you, etc. Note that maintaining one’s market share means growing at the same rate as the industry (rather than not growing at all).
A57
Does the company compete very locally (1-2 mi. radius), locally (to include several zip codes), narrow-regionally (several counties within a state, e.g., Southern California), broad-regionally (e.g., West or East Coast of the U.S., Central America), nationally, or internationally?
A58
Is the company positioned at the high end of the market, typically highest prices and best products, the low end, typically lowest prices and mass produced, or somewhere in the middle, typically priced relatively low for the value offered? With which end does it want its brand identified?
A59
Replace the words "Generic Strategy" with something that makes sense for your company. Generic strategies include differentiation, cost-leadership, and focus (differentiated or specialized for a narrow market segment), developed originally by Michael Porter in the early 1980s
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Your Company Name

Competive Analysis: Porter's Five Forces

Rivals/Competitors Your Company Name

Top 5 competitors of this company: Competitor 1

Competitor 2

Do not Input - These Come Competitor 3

From Competition Input!Competitor 4

Competitor 5

Identify Buyers/Customers

Identify Suppliers

Identify Substitutes

Identify Potential Entrants

Intensity of Rivalry

Bargaining Power of Buyers

Bargaining Power of Suppliers

Print after input is complete for this screen

B22
To help you identify substitutes in an industry, imagine being a customer and ask, "What are my alternatives to buying the industry's product?"
B26
Potential entrants include any company that may enter the industry at any time. Because this happens without warning, they are difficult to identify. However, don't worry about potential entrants if barriers to entering the industry are high.
B29
Is the intensity of competition among rivals low? Medium? High? Is it getting stronger? Weaker? Why?
B32
Who has bargaining power in the industry--the producers (rivals) or customers? Who dictates terms? Who needs the other more? Are buyers' switching costs high? Typically, in a commodity industry where all rivals produce identical products and buyers choose the lowest price, the buyer has bargaining power. When all rivals are differentiated, the industry has bargaining power.
B35
A similar logic exists for ascertaining who has the bargaining power between the industry and its suppliers. Typically, if suppliers are aplenty, the industry has bargaining power; if only one supplier can fulfill the company's needs, then the supplier has the bargaining power.
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Threat of Substitutes

B38
The threat is high if there is a high likelihood the industry will adopt the substitute or if substitute sales are increasing, and low if opposite conditions exist.
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Barriers to Entry

B41
High barriers to enter an industry deter potential entrants from entering the industry. Barriers to entry include capital investment required, the need to set up a distribution system, the time it takes to develop a brand identity (especially if companies compete on the basis of brands) and loyal customers, technological know-how, and manufacturing expertise. A common mistake is to imagine barriers to entry to be very high, whereas certain companies deciding to enter would find the barriers much lower. For example, a company wanting to enter the U.S. motorcycle industry would find the barriers to entry very high, but a foreign motorcycle manufacturer would find the barriers to entry very low.
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Your Company Name

Competive Analysis: Strategic Group MapC

rite

ria

B

Criteria A

User Defined Criteria for X & Y Axes Relative Indication of Size

Criteria A Criteria B Group Size

User Defined Titles of Groups (Y) (Diameter)

Group 1

Group 2

Group 3

Group 4

Strategic Group Map Data

(X)

0 2 4 6 8 10 120

2

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8

10

12Strategic Group Map

Group 1 Group 2

Group 3 Group 4

D33
Variables selected as axes should NOT be highly correlated Variables chosen as axes should expose BIG differences in how rivals compete. Variables do NOT have to be either quantitative or continuous
F33
Indicating sizes of circles proportional to combined sales of firms in each strategic group allows map to reflect relative sizes of each strategic group. Indicate circle sizes for each strategic group, making circles proportional to size of group's respective share of total industry sales. An example would be to have the total add to 10 or 100, indicating the relative share for each group.
C34
STEP 1: Identify competitive characteristics that differentiate firms in an industry from one another STEP 2: Plot firms on a two-variable map using pairs of these differentiating characteristics STEP 3: Assign firms that fall in about the same strategy space to same strategic group STEP 4: Indicate circle sizes for each strategic group, making circles proportional to size of group's respective share of total industry sales INTERPRETING STRATEGIC GROUP MAPS Driving forces & competitive pressures often favor some strategic groups & hurt others. Profit potential of different strategic groups varies due to strengths & weaknesses in each group's market position. The closer strategic groups are on map, the stronger the competitive rivalry among member firms tends to be.
C35
Firms in same strategic group have one or more competitive characteristics in common . . . Sell in same price/quality range Cover same geographic areas Be vertically integrated to same degree Have comparable product line breadth Emphasize same types of distribution channels Offer buyers similar services Use identical technological approaches
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Your Company Name

Competive Analysis: Strategic Group MapC

rite

ria

B

Criteria A

User Defined Criteria for X & Y Axes Relative Indication of Size

Criteria A Criteria B Group Size

User Defined Titles of Groups (Y) (Diameter)

Group 1

Group 2

Group 3

Group 4

Group 5

Strategic Group Map Data

(X)

0 2 4 6 8 10 120

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12Strategic Group Map

Group 1 Group 2

Group 3 Group 4

Group 5

D33
Variables selected as axes should NOT be highly correlated Variables chosen as axes should expose BIG differences in how rivals compete. Variables do NOT have to be either quantitative or continuous
F33
Indicating sizes of circles proportional to combined sales of firms in each strategic group allows map to reflect relative sizes of each strategic group. Indicate circle sizes for each strategic group, making circles proportional to size of group's respective share of total industry sales. An example would be to have the total add to 10 or 100, indicating the relative share for each group.
C34
STEP 1: Identify competitive characteristics that differentiate firms in an industry from one another STEP 2: Plot firms on a two-variable map using pairs of these differentiating characteristics STEP 3: Assign firms that fall in about the same strategy space to same strategic group STEP 4: Indicate circle sizes for each strategic group, making circles proportional to size of group's respective share of total industry sales INTERPRETING STRATEGIC GROUP MAPS Driving forces & competitive pressures often favor some strategic groups & hurt others. Profit potential of different strategic groups varies due to strengths & weaknesses in each group's market position. The closer strategic groups are on map, the stronger the competitive rivalry among member firms tends to be.
C35
Firms in same strategic group have one or more competitive characteristics in common . . . Sell in same price/quality range Cover same geographic areas Be vertically integrated to same degree Have comparable product line breadth Emphasize same types of distribution channels Offer buyers similar services Use identical technological approaches
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Your Company Name

Competive Analysis: Strategic Group MapC

rite

ria

B

Criteria A

User Defined Criteria for X & Y Axes Relative Indication of Size

Criteria A Criteria B Group Size

User Defined Titles of Groups (Y) (Diameter)

Group 1

Group 2

Group 3

Group 4

Group 5

Group 6

Strategic Group Map Data

(X)

0 2 4 6 8 10 120

2

4

6

8

10

12Strategic Group Map

Group 1 Group 2

Group 3 Group 4

Group 5 Group 6

D33
Variables selected as axes should NOT be highly correlated Variables chosen as axes should expose BIG differences in how rivals compete. Variables do NOT have to be either quantitative or continuous
F33
Indicating sizes of circles proportional to combined sales of firms in each strategic group allows map to reflect relative sizes of each strategic group. Indicate circle sizes for each strategic group, making circles proportional to size of group's respective share of total industry sales. An example would be to have the total add to 10 or 100, indicating the relative share for each group.
C34
STEP 1: Identify competitive characteristics that differentiate firms in an industry from one another STEP 2: Plot firms on a two-variable map using pairs of these differentiating characteristics STEP 3: Assign firms that fall in about the same strategy space to same strategic group STEP 4: Indicate circle sizes for each strategic group, making circles proportional to size of group's respective share of total industry sales INTERPRETING STRATEGIC GROUP MAPS Driving forces & competitive pressures often favor some strategic groups & hurt others. Profit potential of different strategic groups varies due to strengths & weaknesses in each group's market position. The closer strategic groups are on map, the stronger the competitive rivalry among member firms tends to be.
C35
Firms in same strategic group have one or more competitive characteristics in common . . . Sell in same price/quality range Cover same geographic areas Be vertically integrated to same degree Have comparable product line breadth Emphasize same types of distribution channels Offer buyers similar services Use identical technological approaches
Page 12: Sonic Strategy (SWOT)

Your Company NameG.E. Matrix

G. E. Matrix Chart

Industry Attractiveness Matrix (I. A.)Factors Weight Rating Product

0 0.0

This index indicates that this is NOT an attractive industry to enter or remain in.

Competitive Strength Matrix (C. S.)Success Factors Weight Rating Product

0 0.0This index indicates that this company is NOT competitive.

The G.E. Matrix was named after the corporation that first developed and used it as a guide to strategic choice. The G.E. Matrix plots Industry Attractiveness (0) against Competitive Strength (0).

If the company plots in the top three boxes (shaded light green), the GE Matrix indicates a possible strategy of 'Grow, Invest, and Build." If it ends up in the bottom three squares (shaded light red), the matrix indicates a 'Harvest' or 'Exit' strategy. The grey shaded

boxes require a strategy on a case-by-case basis.

IndustryAttractiveness

(I.A.) Index

Comp Strength (C.S.) Index

0.0 20.0 40.0 60.0 80.0 100.00.0

20.0

40.0

60.0

80.0

100.0

C.S. Index

I.A. I

nd

ex

A17
NO DATA ENTRY REQUIRED HERE!! This table is duplicated from the "Industry" Worksheet Industry attractiveness depends on several factors. To help you identify these factors, imagine the ideal industry you would like to be in or enter, e.g., large market, high industry growth, no regulation, little competition, low or high entry barriers if outside or inside the industry, and high profitability. With such factors in place, one could then assess the attractiveness of a particular industry by weighting the factors (allocating 100 points among them--the weights will be automatically totaled), and rating them from your company's point of view (between 0-1.0, 1.0 being highest). The weights will be multiplied automatically by the ratings in the last column, and the last column totaled automatically to give an I.A. index (%).
A30
Just as you did for Industry Attractiveness in the Industry Analysis, do a similar analysis here, only the factors involved are different. Here, the factors are similar to critical success factors. Think of 5-8 factors that account for a company's competitive strength in the industry, enter them in the table, assign weights as before (they will be automatically totaled--just make sure they add to 100), and rate your company on each one (on a scale of 0-1.0, 1.0 being best). The weights will be automatically multiplied by the ratings and the products shown in the last column, which is also totaled automatically to yield a C.S. index (%). The CS Index is plotted automatically below against the IA Index in the G.E. Matrix.
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Your Company Name

Market Analysis: Snapshot of the Market

Who is the market?

Who is the target market?

Who is the served market?

What is the size of the target market?

How fast is the market growing (%/yr)?

How far is the market penetrated (%)?

What

What are customers' current needs?

What are customers' future needs?

What are current distribution channels?

What are channel markups at each stage?

How price-sensitive are customers?

What is the current pricing strategy?

What are some market/customer trends?

A7
Who are the firm's customers? Describe them precisely and concisely, including their geographic scope, e.g., not just banks, but banks worldwide.
A9
This is a subset of the total market that the firm wants to reach or target over the next three years (e.g., if your market is banks, your target market could be California banks, instead of a total market of U.S. banks).
A11
This is a subset of the target market that can be realistically served. For example: California banks with not more than 20 branches or $1B in deposits. Another example: a company targeting young adults with high-end fashion products (target market) would consider as the served market only the more wealthy among them that could afford the product.
A13
Using the same example of California banks as the target market, how many such banks are there? In other words, how many customers in your target market?
A15
Don't confuse this with industry growth. E.g., if your market is California banks, how fast are they growing in numbers of banks/yr or in the total dollar sales of California banks? In a consumer market, how fast are your target consumers growing per year?
A17
A brand new market for an industry is 0% penetrated, while a saturated market is 100% penetrated. How far is your target market penetrated, not by you but by your industry? If your product is unique, then answer this question for your company.
A23
Distribution channels are how your product reaches your market. Choices typically include sales people, sales reps, distributors, wholesalers, retailers (independents, chains, boutiques, mass merchandisers).
A25
What is your price out of the factory, what is the retail (final) price, and what are the various in-between prices to wholesalers and distributors, if applicable?
A27
Customers are extremely price-sensitive if they view the industry's products as commodities (i.e., all products are alike), hence go for the lowest price. However, if the industry's products are differentiated, customers will seek the products they want without regard to price. Another test to apply is: If you lowered your price a little, how many more customers would buy your product? If a lot, they are price-sensitive; if very few, they aren't.
A29
Pricing strategy is complex. For now, consider one of the following options: Low-price leader, pricing to allow for a reasonable profit, pricing to position the company in the marketplace (esp. high end), pricing to force competitors out of business, monopoly pricing (esp. for introducing a first-time product), or pricing what the market will bear.
A31
What changes are occurring with your customers or your market? Do they now buy differently? Do they use the product differently? Are their needs changing? Write down here any changes you're aware of.
Page 14: Sonic Strategy (SWOT)

Your Company Name

Environmental Analysis: Impact of Environmental Trends

Statement of Trend

Severity of Impact on Company

Negative Positive

Category

Economic

Demographic

Technological

Other Trends

H M L Neutral L M H

Regulatory/Legislative

Attitude/ Lifestyle

Socio-Cultural

Political/ Legal

B5
For each category of trend below, write down the trends, i.e., something must be getting smaller or larger, slower or faster, higher or lower. Describe the trends and HOW it is changing. Finally, estimate the severity of the impact on the company by choosing either a positive (H, M, or L), neutral, or negative (H, M, or L) impact. The larger the potential impact, either positive or negative, the more data may need to be collected about the trend or change.
Page 15: Sonic Strategy (SWOT)

Print after input is complete for this screen

Your Company Name

Company Analysis: SWOT Analysis

STRENGTHS

List up to eight strengths specific to this company:

1 Differentiation

2 Strong Management

3 Human Resource Policy

4 Fun Culture

5 Excellent Information Technology

6 Franchise Satisfaction

7

8

WEAKNESSESList up to eight weaknesses specific to this company:

1 Liquidity

2 Business Model (Limited to warm climate areas)

3

4

5

6

7

8

B6
Strengths are special capabilities or expertise, things a company does well that has enabled it to be successful to this point, and how it has prepared itself to compete in the future.
B19
Weaknesses are internal. They include problems that need to be corrected, deficiencies recognized only through a comparison with competitors, or deficiencies relative to proposed strategies (e.g., not enough resources to grow)
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OPPORTUNITIES

List up to eight opportunities specific to this company:

1 Broaden Menu

2 Partner and expand to non-core markets (Sonics Express)

3 Continue to build in developing markets

4 Attract younger generations

5

6

7

8

THREATSList up to eight threats specific to this company:

1 Low entry barriers

2 Aging population

3 Competitors (All quick serve businesses)

4 Lower startup costs for competitors entering the market

5

6

7

8

B30
Opportunities are product-market issues, i.e., current, improved, or new product (or service) for an existing, expanded, or new market.
B42
A threat is an external force or impending event that may slow or prevent you from achieving your objectives.
Page 17: Sonic Strategy (SWOT)

Your Company Name

Company Analysis: TOWS Matrix

1. Differentiation 1. Liquidity

2. Strong Management

3. Human Resource Policy 3.

4. Fun Culture 4.

5. Excellent Information Technology 5.

6. Franchise Satisfaction 6.

7. 7.

8. 8.

SO Strategies WO Strategies

1. Broaden Menu

3. Continue to build in developing markets

4. Attract younger generations

5.

6.

7.

8.

ST Strategies WT Strategies

1. Low entry barriers

1. N/A2. Aging population

5.

6.

7.

2. Business Model (Limited to warm climate areas)

Customer satisfaction and loyalty supports expansion

Change business model by adding a sonic express2. Partner and expand to non-core

markets (Sonics Express)

1. Utilize existing franchises to experiment with healthier products

3. Competitors (All quick serve businesses)

4. Lower startup costs for competitors entering the market

INTERNALFACTORS

EXTERNALFACTORS

Strengths (S) Weaknesses (W)

Opportunities (O)

Threats (T)

C17
Strategies that use strengths to take advantage of opportunities
D17
Strategies that take advantage of opportunities by overcoming or mitigating weaknesses.
C26
Strategies that use strengths to avoid or mitigate threats
D26
Strategies that minimize weaknesses and avoid or mitigate threats
Page 18: Sonic Strategy (SWOT)

8.

Page 19: Sonic Strategy (SWOT)

Your Company Name

General Internal Analysis

Current Strategy

When was it last changed?

Corporate Culture

What

Any constraints?

Is the MIS effective?

Does a written Strategic Plan exist?

Is the Company involved in a planned change program?

A7
Strategy can always be inferred from what a company is doing. Sometimes it's very clear, e.g., acquisition, market expansion, or new product development. Sometimes, it's less clear, e.g., differentiation, low-cost leadership, or strategic alliances. Other strategies include vertical integration (forwards or backwards), retrenchment (or downsizing), turnaround, joint venture (a form of strategic alliance), diversification (entering another industry), focus (being specialized and serving a narrow market), and liquidation.
A9
What's worth noting is whether the company's strategies have been changing a lot or steadfast over a period of time. If changed recently, what was it before? Why did it change?
A11
Companies that record and review their strategic-planning process and decisions every year tend to improve the quality of those decisions. If a written strategic plan does not exist, it may be time to put one in writing.
A13
What is it like to "do business in this company?" What is the atmosphere like? Are people innovative, approachable, competitive, cost-conscious, or customer-focused? What adjectives would you use? How would you characterize the company's culture?"
A15
Planned change programs include producing products based on a new technology, using radically different manufacturing processes, installing highly integrated IT systems, changing the culture to one that is innovative, or customer-focused, or market-driven, or cost-conscious, etc. Such programs typically take more than a year to implement, are costly, and involve outside consultants using a planned, phased approach.
A17
Constraints include anything the board or CEO imposes on the company. When Edwin Land was CEO of Polaroid Corp., he would not let the company borrow any money or acquire any other company. Rand Corp., the Santa Monica, CA "think tank," for many years refused to take on nongovernmental clients (and turned away millions of dollars in business by so doing). These are examples of constraints. Does this company have any constraints around which planning must take place?"
A19
The quality of control and decision-making in a company depends almost entirely on the right information getting into the hands of those that most need it when they need it. How good is the company's management information system and use of IT.
Page 20: Sonic Strategy (SWOT)

Your Company Name

Core Competence Assessment

Capability Competitive Consequences Performance Implications

The four criteria that distinguish capabilities from core competencies are related to competitive advantage and firm performance. Valuable capabilities are those that create value for a firm and help it deliver customer value by exploiting opportunities or neutralizing threats in its external environment. Rare capabilities are those possessed by almost no current or potential competitor. Costly-to-imitate capabilities are those that other firms cannot develop easily, quickly, or inexpensively. And nonsubstitutable capabilities are those that do not have strategic equivalents.

Criteria for Core Competence(A capability that meets all 4 criteria is a core competence)

Is the capability valuable?

Is the capability

rare?

Is the capability costly to imitate?

Is the capability nonsubsti-

tutable?

F8
Alternative entries for this column: Competitive disadvantage Competitive parity Temporary competitive disadvantage Sustainable competitive advantage
G8
Alternative entries for this column: Below-average returns Average returns Average to above-average returns Above-average returns
Page 21: Sonic Strategy (SWOT)

Your Company Name

Value Analysis

1. Indicate the extent to which the following value shifts are taking place in the industry:

Operational Excellence

Product Leadership

Customer Intimacy

Value-based Management

Are there higher than usual margins in a particular product or product line?

Is there higher than usual sales growth in a particular product or product line?

Is there a higher than expected market valuation in certain companies or among newcomers to the industry?

Is there rising or declining brand equity for companies in the industry?

Disintermediation?

Transmigration?

Relative Scores for Each Value DisciplineIndicate a score for the company, competitors and industry on the following value disciplines, from 1 to 10 (1=worst and 10=best).

Operational Excellence Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5 Industry

Information Systems

Production Efficiency

Re-Engineering using S.A.I.L. :

Other

Other

Other

SCORE 0 0 0 0 0 0 0

Product Leadership Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5 Industry

R&D Capability (Innovation)

Product Development

Marketing and Sales

Distribution

Brand Equity Management

Value Chain Integration

Other

Other

Other

2.        What signs of shifting value are occurring in the industry?

3.        To what extent are the following activities taking place in the industry’s traditional value chain using technology or other enabling mechanisms:

Your Company Name

- Simplification

- Automation

- Integration

- Leadership

Your Company Name

1 2 3 4 5

Yes No

1 2 3 4 5

A4
The term "value disciplines" was developed by Treacy and Wiersema* to describe different ways companies create value for customers. They describe three general strategies that have been successfully used by many companies: Product Leadership, Operational Excellence, and Customer Intimacy. A fourth strategy not included in Treacy and Wiersema's model, involves the dimension of Value-Based Management. Most successful companies excel in at least one of these dimensions and have, as a result, strengthened their strategic focus. By fully developing at least one of these value disciplines, a company can create a gap between itself and its competitors. By fully developing two or more of these disciplines, an even wider gap can be attained. Based on these concepts, this spreadsheet assists a company to rate its performance in these four value disciplines and compare it to the industry, competitors, and itself. It will help the company identify where its strengths and weaknesses lie and provide a frame of reference from which to focus desired value-added activities. *Cornelis A. de Kluyver, Strategic Thinking, An Executive Perspective, 2000, Prentice Hall.
A6
Rate from 1 to 5, which value disciplines the company's industry seems to be shifing towards (1=industry shifing towards, 5=industry shifing away from)
A9
Operational excellence is a strategic approach that focuses on improving production and delivery mechanisms. Companies that have successfully developed operational excellence include Dell, Wal-Mart, Southwest Airlines and Federal Express.
A10
Product leadership is the continuous production of innovative products and services. These companies are driven by product improvement and constantly raise the standard by offering better products and solutions to service problems. Companies that are successful at product leadership include Johnson & Johnson and Microsoft
A11
Customer intimacy focuses on obtaining customer loyalty and the foundations of customer service which includes employee satisfaction. These companies tailor services to customers' changing needs. Companies that have focused on and have been successful at customer intimacy include Nordstrom and Home Depot.
A12
Value-Based Management is a framework that encourages management to create value by providing incentives to pursueprojects that provide capital at returns that exceed the cost of capital. It also includes incentives for management approaches that promote an environment of learning, empowerment, collaboration and continuous change. Companies that have focused on value-based management include Westinghouse and Marriott.
A14
Indicate the presence or non-presence of the following categories within the industry.
A22
Ranking: 1=No, 5=To a large extent. Have competitors or participant in an existing value chain* taken the place of traditional participants in that value chain? *Value Chain: The entire sequence of value-added processes that transform raw materials into end-user products in stages. The sequence of value-added activities a company performs to produce a product or service from R&D through production to after-sales service.
A23
Ranking: 1=No, 5= To a large extent. Have new competitors from completely different industries entered the industry's market?
A26
Rank the company, competitors and industry on the following value disciplines listed, from 1 to 10 with 1=worst and 10=best.
A28
Operational excellence is a strategic approach that focuses on improving production and delivery mechanisms. Companies that have successfully developed operational excellence include Dell, Wal-Mart, Southwest Airlines and Federal Express.
A29
Companies with updated information systems allow their operations to run more effectively and add value to the overall efficiency of operations.
A30
The operation that is set up for efficiency will streamline the production process, thus adding value to the company's bottom line. Extensive and ongoing use of continuous quality improvement, statistical process control, and automation are examples of ensuring production efficiency. To what extent does the company implement tools to ensure production efficiency?
A32
Reducing non-value added activities could reduce the cycle time of an operation without requiring any increased use of information systems, personnel or other company resources. To what extent does the company implement work simplification methods?
A33
The integration of increased workforce empowerment and better use of information and automation systems will improve the operation and reduce labor. This step integrates functions within a single core process.
A34
Multiple core processes within a business are integrated to include extended enterprises, e.g., SCM (supply-chain management) and CRM (customer-relationship management) systems, where appropriate.
A35
To what degree do production leaders implement the strategic plan at the operational level? This includes the "more is better" approach in regard to implementation of work teams, employee empowerment, downward delegation, and the promotion of collaboration, learning and change.
A36
Include other relevant performance measures within the Operational Excellence section.
A42
Product leadership is the continuous production of innovative products and services. These companies are driven by product improvement and constantly raise the standard by offering better products and solutions to service problems. Companies that are successful at product leadership include Johnson & Johnson and Microsoft
A43
The degree of continual innovation of products and services and the extent of the ability to come up with innovative ideas, technologies, and processes.
A44
The ability to improve existing products and develop new ones for specific markets.
A45
The extent to which a company is innovative, using non-traditional methods for marketing and selling products and services.
A46
The degree of close integration with downstream value chain participants
A47
The extent to which the company develops, strengthens, and manages its brand equity.
A48
The extent to which enterprise networks develop upstream and downstream value chain participants
A49
Include other relevant performance measures within the Product Leadership section.
Page 22: Sonic Strategy (SWOT)

Your Company Name

Value AnalysisSCORE 0 0 0 0 0 0 0

A4
The term "value disciplines" was developed by Treacy and Wiersema* to describe different ways companies create value for customers. They describe three general strategies that have been successfully used by many companies: Product Leadership, Operational Excellence, and Customer Intimacy. A fourth strategy not included in Treacy and Wiersema's model, involves the dimension of Value-Based Management. Most successful companies excel in at least one of these dimensions and have, as a result, strengthened their strategic focus. By fully developing at least one of these value disciplines, a company can create a gap between itself and its competitors. By fully developing two or more of these disciplines, an even wider gap can be attained. Based on these concepts, this spreadsheet assists a company to rate its performance in these four value disciplines and compare it to the industry, competitors, and itself. It will help the company identify where its strengths and weaknesses lie and provide a frame of reference from which to focus desired value-added activities. *Cornelis A. de Kluyver, Strategic Thinking, An Executive Perspective, 2000, Prentice Hall.
Page 23: Sonic Strategy (SWOT)

Your Company Name

Value Analysis

Customer IntimacyCompetitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5 Industry

Customer Service

Customer Satisfaction

Customer Loyalty

Employee Capability

Employee Satisfaction

Employee Loyalty

Employee Productivity

Other

Other

Other

SCORE 0 0 0 0 0 0 0

Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5 Industry

Management Skills

Making Managers into Owners

Managerial Performance

Other

Other

SCORE 0 0 0 0 0 0 0

TOTAL SCORE 0 0 0 0 0 0 0

Your Company Name

Value-Based Management

Your Company Name

Your Com-pany Name

Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5 Industry0

1

1

0 0 0 0 0 0 0

Industry Value Analysis - Relative Scores

A4
The term "value disciplines" was developed by Treacy and Wiersema* to describe different ways companies create value for customers. They describe three general strategies that have been successfully used by many companies: Product Leadership, Operational Excellence, and Customer Intimacy. A fourth strategy not included in Treacy and Wiersema's model, involves the dimension of Value-Based Management. Most successful companies excel in at least one of these dimensions and have, as a result, strengthened their strategic focus. By fully developing at least one of these value disciplines, a company can create a gap between itself and its competitors. By fully developing two or more of these disciplines, an even wider gap can be attained. Based on these concepts, this spreadsheet assists a company to rate its performance in these four value disciplines and compare it to the industry, competitors, and itself. It will help the company identify where its strengths and weaknesses lie and provide a frame of reference from which to focus desired value-added activities. *Cornelis A. de Kluyver, Strategic Thinking, An Executive Perspective, 2000, Prentice Hall.
A57
Customer intimacy focuses on obtaining customer loyalty and the foundations of customer service which includes employee satisfaction. These companies tailor services to customers' changing needs. Companies that have focused on and have been successful at customer intimacy include Nordstrom and Home Depot.
A58
Consumers are value-oriented and seek results and service quality that exceed the price and acquisition costs they incur for a service. If services are difficult to obtain, a cut-rate price will not produce high value to the customer. On the other hand, a service may be of high value if it is convenient enough for the customer. In this case, s/he may be willing to pay a relatively high price and any other costs to acquire the service. The extent to which a company places a high emphasis on service is the extent to which it satisfies the customer.
A59
Customer satisfaction factors may vary among industries, but may include factors such as speed, efficiency, quality of service, quality of product, perceived value, pleasantness, follow-through and problem resolution. High levels of customer satisfaction are closely correlated with high levels of customer loyalty.
A60
Customer loyalty is the degree to which customers repurchase a company’s services or products. Customer loyalty is a more important determinant of profit than market share in a wide range of industries according to a study by Reicheld and Sasser*. How loyal are your customers to your services or products? *Frederick F Reichheld and W. Earl Sasser, Jr., Zero Defections: Quality Comes to Services, Harvard Business Review, September-October 1990, pp105-111.
A61
Employee capability is the extent to which employees believe they can accomplish their jobs. It is also the extent to which employees are given the resources, tools and autonomy to accomplish their responsibilities. Employee capability is strongly linked to employee satisfaction.
A62
Employee satisfaction is influenced by the internal quality of life, which is the feeling employees have toward their jobs, colleagues, and companies. This feeling can be shaped by factors such as attitudes employees have toward one another, how they serve each other within the company, physical surroundings, workplace safety and, in general, “how things get done”. High levels of employee satisfaction in most industries are associated with high levels of employee loyalty.
A63
One measure of employee loyalty is employee turnover. Highly successful companies typically have annual turnover rates of less than 5%. High employee retention rates are associated with high levels of employee satisfaction, high productivity and high profits.
A64
High levels of productivity are strongly correlated with customer service value (as in #1). How does the company’s employee productivity stack up to competitors and to internal standards? Is there room for improvement? If so, start by examining employee capability.
A65
Include other relevant performance measures within the Customer Intimacy section
A71
Value-Based Management is a framework that encourages management to create value by providing incentives to pursue projects that yield returns that exceed the cost of capital. It also includes incentives for management approaches that promote an environment of learning, empowerment, collaboration and continuous change. Companies that have focused on value-based management include Westinghouse and Marriott.
A72
The management teams in a company are what make up the character and success of a company. To what extent is the company investing in the knowledge and skills of good management teams? Does management promote overall (personal and organizational) learning, creativity, collaboration and change?
A73
To revitalize and redirect managerial incentives, companies should give managers bonuses that are a share of EVA. This helps to motivate them to create value and make them think and behave like owners. Basing bonuses on attainment of planned level of performance only makes managers manage earnings and expectations of the corporate office instead of maximizing value.
A74
Do the performance ratings for managers include the degree to which they choose and successfully implement projects that provide returns that exceed the cost of capital? Do they take into the account the extent to which management successfully develops and implements competitive strategies?
A75
Include other relevant performance measures within the Value-Based Management section.
Page 24: Sonic Strategy (SWOT)

Your Company Name

Value AnalysisNote: This tool has been adapted from a version created by Cal Poly Pomona MBA Students Karie Cole, David Tang and John Walker, Winter 2000.

A4
The term "value disciplines" was developed by Treacy and Wiersema* to describe different ways companies create value for customers. They describe three general strategies that have been successfully used by many companies: Product Leadership, Operational Excellence, and Customer Intimacy. A fourth strategy not included in Treacy and Wiersema's model, involves the dimension of Value-Based Management. Most successful companies excel in at least one of these dimensions and have, as a result, strengthened their strategic focus. By fully developing at least one of these value disciplines, a company can create a gap between itself and its competitors. By fully developing two or more of these disciplines, an even wider gap can be attained. Based on these concepts, this spreadsheet assists a company to rate its performance in these four value disciplines and compare it to the industry, competitors, and itself. It will help the company identify where its strengths and weaknesses lie and provide a frame of reference from which to focus desired value-added activities. *Cornelis A. de Kluyver, Strategic Thinking, An Executive Perspective, 2000, Prentice Hall.
Page 25: Sonic Strategy (SWOT)

Your Company NameSPACE Analysis

Strategic position and action evaluation (SPACE) is used to determine the appropriate strategic posture for a

company. Financial Strength (FS) and Competitive Advantage (CA) are the two primary determinants of a firm's

strategic position. Industry Strength (IS) and Environmental Stability (ES) characterize the entire industry. You are to

assign scores (below) for each of the 4 dimensions. Each factor contains a comment to assist in scoring. Averages

(or average minus 6 as indicated) for each dimension are plotted on the chart. The result is a four-sided polygon

displaying the weight and direction (the "thrust") of the strategic assessment. By adding the results of the two X-axis

dimensions (CA & IS) and the two Y-axis dimensions (FS& ES), an (X,Y) coordinate is obtained and plotted on the chart

to determine the appropriate strategic posture. Keep in mind that the SPACE Chart is a summary device and each

dimension should be analyzed individually as well, especially if any dimension results in a high or low score.

Strategic Dimensions and Scoring

Factors Determining Financial Strength (FS) Factors Determining Industry Strength (IS)

Indicate a score for each of the following criteria. Indicate a score for each of the following criteria.

Return on Investment Growth Potential

Leverage Profit Potential

Liquidity Technological Know-How

Capital Required Versus Capital Available Resource Utilization

Cash Flow Capital Intensity

Risk Involved in Business Ease of Entry into Market

Inventory Turnover Productivity, Capacity Utilization

Economies of Scale and Experience Other:

Other:

Average #DIV/0! Average #DIV/0!

Factors Determining Environmental Stability (ES) Factors Determining Competitive Advantage (CA)

Indicate a score for each of the following criteria. Indicate a score for each of the following criteria.

Technological Changes Market Share

Rate of Inflation Product Quality

Demand Variability Product Life Cycle

Price Range of Competing Products Product Replacement Cycle

Barriers to Entry into Market Customer Loyalty

Competitive Pressure/Rivalry Competition's Capacity Utilization

Price Elasticity of Demand Technological Know-How

Pressure from Substitute Products Vertical Integration

Other: Differentiation, Uniqueness

Other:

Average - 6 #DIV/0! Average - 6 #DIV/0!

A5
Stands for Strategic Position and ACtion Evaluation. A tool to help determine the appropriate strategic posture of a firm. Involves plotting competitive advantage, industry strength, financial strength, and environmental stability on a two-dimensional graph. Each of these four dimensions itself comprises a number of factors that are evaluated independently and then combined to yield an average score. The resulting plot could end up favoring one of four quadrants (the strategic postures), which are aggressive, competitive, defensive, and conservative
A20
0 = Low 6 = High
G20
0 = Low 6 = High
A21
0 = Imbalanced 6 = Balanced
G21
0 = Low 6 = High
A22
0 = Imbalanced 6 = Solid
G22
0 = Simple 6 = Complex
A23
0 = High 6 = Low
G23
0 = Inefficient 6 = Efficient
A24
0 = Low 6 = High
G24
0 = Low 6 = High
A25
0 = Much 6 = Little
G25
0 = Easy 6 = Difficult
A26
0 = Slow 6 = Fast
G26
0 = Low 6 = High
A27
0 = Low 6 = High
G27
Add additional factor if appropriate. Keep in mind that higher score is relatively positive or "good." Make sure if you do not use the "Other" factor, that there is not a zero in the score field, as this will affect the average. Simply leave it blank.
A28
Add additional factor if appropriate. Keep in mind that higher score is relatively positive or "good." Make sure if you do not use the "Other" factor, that there is not a zero in the score field, as this will affect the average. Simply leave it blank.
A33
0 = Many 6 = Few
G33
0 = Small 6 = Large
A34
0 = High 6 = Low
G34
0 = Inferior 6 = Superior
A35
0 = Large 6 = Small
G35
0 = Late 6 = Early
A36
0 = Wide 6 = Narrow
G36
0 = Variable 6 = Fixed
A37
0 = Few 6 = Many
G37
0 = Low 6 = High
A38
0 = High 6 = Low
G38
0 = Low 6 = High
A39
0 = Elastic 6 = Inelastic
G39
0 = Low 6 = High
A40
0 = High 6 = Low
G40
0 = Low 6 = High
A41
Add additional factor if appropriate. Keep in mind that higher score is relatively positive or "good." Make sure if you do not use the "Other" factor, that there is not a zero in the score field, as this will affect the average. Simply leave it blank.
G41
0 = Little 6 = Much
G42
Add additional factor if appropriate. Keep in mind that higher score is relatively positive or "good." Make sure if you do not use the "Other" factor, that there is not a zero in the score field, as this will affect the average. Simply leave it blank.
Page 26: Sonic Strategy (SWOT)

Your Company NameSPACE Analysis

Strategic Position and ACtion Evaluation (SPACE)

#DIV/0! #DIV/0!

#DIV/0! #DIV/0!

Financial Strength FS #DIV/0! #DIV/0!

Industry Strength IS #DIV/0! #DIV/0!Environmental StabiES #DIV/0! #DIV/0!Competitive Advan CA #DIV/0! #DIV/0!

Descriptions of Strategic Postures

Conservative Aggressive

Defensive Competitive

This posture is common in a market which is stable with low growth. Focus should be on financial stability and product competitiveness. Common practices for companies in this situation: prune product line, reduce costs, cash flow improvement, protection of competitive products, new product development, and entering more attractive markets.

This situation is typical in a very attractive industry without environmental uncertainty. Financial strength helps protect the company's competitive advantage. Critical to this company is risk of entry of new competition. Common practices for companies in this situation: explore new opportunities, acquisitions, increase market share, and focus resources on products that have a competitive advantage.

This posture is common in an industry which is unattractive where the company lacks financial strength and lacks a competitive product. Focus should be on product competitiveness. Common practices for companies in this situation: retreat from the market, discontinue products with low profitability, aggressive cost cutting measures, cut capacity, halt or reduce further investment.

This situation is typical in a company with a definite competitive advantage in a very attractive industry with some environmental uncertainty. Critical to this company is financial strength. Common practices for companies in this situation: acquire financial resources to increase marketing effort, increase sales force, expand/improve product offerings, productivity investments, cost reduction, or merge with cash-rich company.

This model is adapted from Strategic Management: A Methodological Approach by Rowe, Mason, Dickel, Mann and Mockler, 1994, p.255-265.

FS

IS

ES

CA -

1.0

2.0

3.0

4.0

5.0

6.0

Aggressive - Strength on all dimensions

Competitive - Comp. advantage in good industry, but weak in financial and environmental stability

Defensive - Relative weakness on most dimensions

Conservative -Financially sound, but market is very competitive and is waning

(High)

(High)(Low)

(Low)

Page 27: Sonic Strategy (SWOT)

Your Company NameAlternatives Analysis and Choice

Strategies Developed Using TOWS Matrix

SO Strategies 0 0 0

WO Strategies 0 0 0

ST Strategies 0 0 0

WT Strategies N/A 0 0 0

Key External Strategic Issues

1.

2.

3.

4.

5.

Key Internal Strategic Issues

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

Customer satisfaction and loyalty supports expansion

Change business model by adding a sonic express

Utilize existing franchises to experiment with healthier products

A4
These strategies will automatically appear based on input from "TOWS Matrix."
A9
A key external strategic issue is an external force or impending event that could impact the company dramatically, e.g., an economic downturn, upcoming regulation, or an advance in a new technology.
A15
A key internal strategic issue is a decision the company might make about its future that would have a strategic impact on it, e.g., merge with or acquire another company, focus on technological development, expand internationally, diversify, etc. Think of strategic issues also as something that keeps the CEO up at night or that is constantly on his or her mind. List up to 12 strategic issues. Many come from your earlier listings of weaknesses, opportunities, and threats.
Page 28: Sonic Strategy (SWOT)

Your Company NameAlternatives Analysis and Choice

Strategic Alternatives

Bundle 1 Bundle 2 Bundle 3 Bundle 4

Name Bundle 1 Name Bundle 2 Name Bundle 3 Name Bundle 4

Describe each bundle fully

A31
Create "bundles" of strategic alternatives based on the strategic issues identified above. You may choose to use two, three or four bundles. As you develop them, check that they are mutually exclusive (doing any one means you cannot do the others) and plausible (both feasible and leading to a successful outcome). Bundles may contain elements of strategic intent, strategies, programs, or other components. Everything you intend to do if adopting a bundle must be in it at this time. To distinguish the bundles, choose a label for each one that captures the essence of it and write it on the gold-highlighted line.
Page 29: Sonic Strategy (SWOT)

Your Company NameAlternatives Analysis and Choice

Criteria Matrix

Choose NO MORE than 6 of the following criteria to use in your evaluation of the bundles:

Fit with corporate culture Extent to which culture must change

Adverse effect on competitors Capital investment required

Contribution to shareholder value Likelihood of competitive retaliation

Growth in revenues Time to breakeven point

Growth in profits Overall riskiness

Return on investment Other

Strength of value proposition Other

Increase in bargaining power Other

Other Other

Other Other

Criteria Matrix

Bundle 1 Bundle 2 Bundle 3 Bundle 4

Name Bundle 1 Name Bundle 2 Name Bundle 3 Name Bundle 4

P

P

P

Growth in revenues P

Growth in profits P

Return on investment P

P

P

Other P

Other P

N

N

N

Time to breakeven point N

Overall riskiness N

Choose the most relevant of the following positively correlated criteria to use in your evaluation of the bundles. To add your

own, overwrite "Other" cells.

Choose the most relevant of the following negatively correlated criteria to use in your evaluation of the bundles. To add your own, overwrite "Other" cells.

Indicate a score from 0 to +10 (10 being best) for the positively correlated criteria chosen (indicated by "P")

Indicate a score from -10 to 0 (0 being best) for the negatively correlated criteria chosen (indicated by "N")

Fit with corporate culture

Adverse effect on competitors

Contribution to shareholder value

Strength of value proposition

Increase in bargaining power

Extent to which culture must change

Capital investment required

Likelihood of competitive retaliation

A44
A number of criteria are listed here to assist you in choosing which bundle the company should adopt and pursue. All the criteria may not be relevant in your case. Use only those (plus any additional ones you can think of) that pertain to your situation.
Page 30: Sonic Strategy (SWOT)

Your Company NameAlternatives Analysis and Choice

Other N

Other N

Other N

Other N

Other N

OVERALL SCORE 0 0 0 0

Page 31: Sonic Strategy (SWOT)

Your Company NameAlternatives Analysis and Choice

Name Bundle 1 Name Bundle 2 Name Bundle 3 Name Bundle 4

Bundle Description

(will appear based on choice above)

Indicate Bundle Choice

Rationale for selecting the preferred choice

Bundle 1 Bundle 2 Bundle 3Indicate Selection

Bundle 4

A104
Tell here which bundle you chose and why. Don't just tell why the bundle you chose was good. You must ARGUE for why it is better than the others, or WHY you specifically rejected the ones you did not choose.
Page 32: Sonic Strategy (SWOT)

Your Company NameRecommendations

Print after input is complete for this screen

Decisions for the Next Three YearsINPUT SHEET

Most Recent Year

Revenues

Overwrite cell B11 with first year

Objectives 2005 2006 2007

Use this section to indicate annual changes in absolute dollars

Revenues - - -

- - -

Use this section to indicate annual changes as percentage changes

Revenues

Other

Other

Strategic Intent

Programs

Enter Data to be used for charting

Net Income After Taxes (NIAT)

Net Income After Taxes (NIAT)

Net Income After Taxes (NIAT)

A7
Enter in absolute dollar values
A11
Express the objectives for Revenues and NIAT as either an absolute $ figure or a percentage increase over the previous year. Use the appropriate section (either $ or %) for your input -- do not enter data in both sections. This allows Excel to chart your results. For financial ratio objectives, it is best to state the value of the ratio itself as the objective.
A20
For financial ratio objectives, it is best to state the value of the ratio itself as the objective.
A21
For financial ratio objectives, it is best to state the value of the ratio itself as the objective.
A23
This has to do with market shares and changing or defending your ranking in the industry. E.g., if the market leader, you should elect to maintain your leadership position; if not, you might want to become #4 from #5, or overtake the leader, or maintain your #2 position, or defend against #8 who is creeping up on you to challenge you, etc.
A25
These are actual activities the company should do in order to achieve the objectives set for a particular year. Remember that programs which take several years to implement must be started in the next year, even though they would not be completed that year.
Page 33: Sonic Strategy (SWOT)

Your Company NameRecommendations

Print after input is complete for this screen

Trigger-Contingency Pairs

2005 2006 2007

Trigger

Contingency

Trigger

Contingency

Trigger

Contingency

A38
Murphy's Law ("if anything can go wrong it will") is alive and well. Therefore we should acknowledge it. A trigger is something that might go wrong in the future, such as a key result not being achieved, loss of a key manager, an assumption being proved wrong, etc. In order to know precisely when the back-up plan (contingency) should be invoked, the trigger should be quantitatively expressed.
A39
A contingency plan is a back-up plan. Use it only when a trigger point is reached. It must be something the company would do differently if the trigger occurred. Two types of contingency are not acceptable: (1) changing the strategy to one you have previously rejected, and (2) doing something you do regularly that gave rise to the trigger in the first place. When things go wrong, a good manager tries first to correct or improve implementation of the strategy, i.e., operations or programs. Only when those have been tried and failed should you consider changing the strategy.
Page 34: Sonic Strategy (SWOT)

Your Company Name

Mission Statements

CURRENT MISSION STATEMENT

PROPOSED MISSION STATEMENT

A6
A mission statement is a concise statement of a company's reason for being. It should contain what products or services the company produces for which target market, as well as how it considers itself different or unique. Avoid statements of values, strategies, or objectives. Typically, once formulated, it should guide and constrain the activities and strategies of a company. However, only after a thorough strategic analysis of a company is someone able to decide whether an existing mission statement is still relevant or ought to be changed. If it should be changed, make sure it embraces what the company does now and what it is going to do over the next few years. Try not to formulate it too broadly (it will fail to guide) or too narrowly (it will force the company to miss out on opportunities). Make it accurate, short, and memorable.
A9
A mission statement is a concise statement of a company's reason for being. It should contain what products or services the company produces for which target market, as well as how it considers itself different or unique. Avoid statements of values, strategies, or objectives. Typically, once formulated, it should guide and constrain the activities and strategies of a company. However, only after a thorough strategic analysis of a company is someone able to decide whether an existing mission statement is still relevant or ought to be changed. If it should be changed, make sure it embraces what the company does now and what it is going to do over the next few years. Try not to formulate it too broadly (it will fail to guide) or too narrowly (it will force the company to miss out on opportunities). Make it accurate, short, and memorable.
Page 35: Sonic Strategy (SWOT)

Your Company Name

Vision Statements

CURRENT VISION STATEMENT

PROPOSED VISION STATEMENT

A6
This is a concise statement of where you would like to see your company 5-10 years from now. A vision statement, in many ways, is more important as a direction-setter for a company than is a mission statement. It answers the question of where a company aspires to go and what it aspires to become in the future (5-10 years). It embodies the vision articulated by the company's leader. To be more effective, a vision statement should contain numbers that give it greater precision. Like a mission statement, a vision statement should be short and memorable, but in addition should be inspiring and achievable. Remember it's the VISION that drives the company, not the mission.
A9
This is a concise statement of where you would like to see your company 5-10 years from now. A vision statement, in many ways, is more important as a direction-setter for a company than is a mission statement. It answers the question of where a company aspires to go and what it aspires to become in the future (5-10 years). It embodies the vision articulated by the company's leader. To be more effective, a vision statement should contain numbers that give it greater precision. Like a mission statement, a vision statement should be short and memorable, but in addition should be inspiring and achievable. Remember it's the VISION that drives the company, not the mission.
Page 36: Sonic Strategy (SWOT)

tw

Strategic Analysis

for

Your Company NameA Public Corporation

0

Prepared by

0

Company Snapshot

Segment Industry

0 0

Products/Services

0

CEO Name CEO Style

0 0

No. Locations How Many States/Countries?

0 0

Number of Employees No. Years in Business

0 0

Parent Corporation/Company Ticker Symbol Stock Price Range (12 Mo)

Page 37: Sonic Strategy (SWOT)

Your Company Name

Competitive Analysis: Snapshot of the Competition

Type of Competition Basis of Competition

0 0

Market Share DataYour Company Name 0%

Competitor 1 0% `

Competitor 2 0%

Competitor 3 0%

Competitor 4 0%

Competitor 5 0%

Others 0%

0%

Are Market Shares Stable or Changing?

Critical Success Factors - Weighted Score ResultsFactor Your Company Name Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5

0 0 0 0 0 0 0

0 0 0 0 0 0 0

0 0 0 0 0 0 0

0 0 0 0 0 0 0

0 0 0 0 0 0 0

0 0 0 0 0 0TOTAL WEIGHTED

SCORE

Your Company Name

Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 50

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

Critical Success Factors - Total Weighted Scores

D9
Market share is calculated typically using total dollar sales in the industry, taking into account not only number of units sold but also their price. Sometimes, market share is calculated on a different basis, e.g., number of screens in the movie-theater industry, or installed base in the telecommunications-switching industry, or # beds in hospitals. Enter top five competitors below your company and market share percentages.
Page 38: Sonic Strategy (SWOT)

Your Company Name

Competitive Analysis: Snapshot of the Competition

Your Company Name

Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 50

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

Critical Success Factors - Total Weighted Scores

Page 39: Sonic Strategy (SWOT)

Your Company Name

Competitive Analysis: Snapshot of the Competition

Matrix of Strategic FactorsStrategic Factor Your Company Name Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5

Core Competence #REF! #REF! #REF! #REF! #REF! #REF!

Strategic Intent

Geographic Scope

Positioning

Generic Strategy

Things that Your Company Name does better than the competition:Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5

Things that the competion does better than Your Company Name:Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5

Competitive Advantage

Page 40: Sonic Strategy (SWOT)

Adapted from

Michael E

. Porter, "H

ow C

ompetitive F

orces Shape S

trategy," Harvard B

usiness Review

57, no. 2 (March-A

pril 1979), pp. 137-45.

Po

rter's Five F

orces M

od

el of C

om

petitio

n

AB

C C

orp.

POTENTIAL NEW ENTRANTS

RIVALS

SUPPLIERS OF KEY INPUTS Your Company Name

BUYERS

Competitor 1

Competitor 2

Competitor 3

Competitor 4

Competitor 5

SUBSTITUTE PRODUCTS

Barriers to Entry:

Intensity of Rivalry: Bargaining Power of Buyers:

Threat of Substitutes:

Page 41: Sonic Strategy (SWOT)

Your Company Name

SWOT Analysis

STRENGTHS WEAKNESSES

Differentiation Liquidity

Strong Management Business Model (Limited to warm climate areas)

Human Resource Policy 0

Fun Culture 0

Excellent Information Technology 0

Franchise Satisfaction 0

0 0

0 0

OPPORTUNITIES THREATS

Broaden Menu Low entry barriers

Partner and expand to non-core markets (Sonics Express) Aging population

Continue to build in developing markets Competitors (All quick serve businesses)

Attract younger generations Lower startup costs for competitors entering the market

0 0

0 0

0 0

0 0

Low entry barriers

Page 42: Sonic Strategy (SWOT)

Your Company NameRecommendations

Decisions for the Next Three Years

Objectives 2005 2006 2007

Revenues 0.0% 0.0% 0.0%

0.0% 0.0% 0.0%

Other 0 0 0

Other 0 0 0

Strategic Intent

Programs

Net Income After Taxes (NIAT)

Most Recent Year

2005 2006 2007

-

1

1

Revenues

Most Re-cent Year

2005 2006 2007

-

1

1

Net Income After Taxes (NIAT)

A3
Companies used to engage in five-year planning exercises but, because of the rapid pace of change, have now switched to a three-year planning horizon, viewed as the "long term" in terms of decision-making. Of course, depending on the industry and company in question, the planning horizon could be considerably longer, in which case you should feel free to make the necessary changes, e.g., instead of Years 2 and 3, you might want to substitute Years 5 and 10.
Page 43: Sonic Strategy (SWOT)

Your Company NameRecommendations

Page 44: Sonic Strategy (SWOT)

Your Company NameRecommendations

Trigger-Contingency Pairs

Year 1 Year 2 Year 3

Trigger

Contingency

Trigger

Contingency

Trigger

Contingency

Page 45: Sonic Strategy (SWOT)

Check boxes - Basic Data1 A Public Corporation

A Private Company

Forms - Industry1 Lifecycle Stage1 Degree of Vertical Integration1 Degree of Technological Innovation

Scale Economies0 Purchasing0 Distribution0 Manufacturing0 Advertising1 Industry Profitability1 Degree of Concentration

STRATEGY0 Fit with corporate culture0 Adverse effect on competitors0 Contribution to shareholder value0 Growth in revenues0 Growth in profits0 Return on investment0 Strength of value proposition0 Increase in bargaining power0 Other0 Other0 Extent to which culture must change0 Capital investment required0 Likelihood of competitive retaliation0 Time to breakeven point0 Overall riskiness 0 Other0 Other0 Other0 Other0 Other