Tuesday, October 12, 2021

Boston consulting group business plan

Boston consulting group business plan

boston consulting group business plan

BCG experts help clients build a robust internal pricing organization—a core part of our work—because pricing needs to be a core part of yours. Marketing Function Excellence. Marketing organizations are expected to respond quickly to changing conditions, and the job of marketers has grown more complex Sep 24,  · BCG was the pioneer in business strategy when it was founded in Today, we work closely with clients to embrace a transformational approach aimed at benefiting all stakeholders—empowering organizations to grow, build sustainable competitive advantage, and drive positive societal blogger.comted Reading Time: 10 mins Jul 18,  · Boston Consulting Group partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities. BCG was the pioneer in business strategy when it was founded in Estimated Reading Time: 9 mins



Your Strategy Process Needs a Strategy



By Martin ReevesJulien Legrandand Jack Fuller. S boston consulting group business plan the birth of business strategy as a discipline in the early s, business leaders have had access to an ever wider range of approaches to strategy: the classical plan-and-execute approach, adaptive strategy, ecosystem-based strategy, blue ocean strategyvalue migration, the dynamic capabilities approach, and so on, boston consulting group business plan.


But despite this broadening array of approaches, the process of developing and realizing strategy within a company has remained essentially the same: strategic planning. Senior executives supply an ambition and direction, business units develop a more detailed plan grounded in market and competitive analysis, and the plan is challenged, finalized, and adopted until the next planning cycle. The problem is, there can be a dramatic mismatch between this process and the business environment.


Fast-changing conditions can quickly make any plan obsolete. For instance, a company may need to be more experimental and exploratory, or to co-evolve with other actors in a multicompany ecosystem, boston consulting group business plan, neither of which is facilitated by episodic, company-wide planning cycles. We need to rethink the process by which we define and operationalize strategy. We need to widen the process options available to the strategy function, so that our strategy truly helps us win in the specific business environment we are facing.


As business environments have grown more diverse in recent decades, picking the right approach to strategy for each context has become increasingly important. As shown in Exhibit 1, there are five broad approaches to strategy :, boston consulting group business plan.


A leader needs to get three things right when it comes to strategy: read the business environment correctly, choose a general approach to strategy that fits the environment, then set up a process to enact that approach in her particular company. Even if an executive gets the first two parts right and identifies the right approach—renewal, say—the company may end up sticking with classical, firm-wide cycles of planning or setting up multiple experiments—processes that are too slow or not radical enough for a renewal strategy.


And so the initial, insightful intention—the chosen approach—is not realized in practice. Linking up the approach and the process is not easy. When General Electric set out to become a leading digital company aroundfor example, then-CEO Jeff Immelt was aware of the need for an adaptive approach. For each of the five approaches outlined above, we can define a matching process. The essence of the classical approach is to create and implement a stable plan of action, which works best when the environment is relatively predictable.


The job of the process, then, is to enable the creation of an actionable plan. The initial direction or ambition comes from the executive team; this is usually followed by various kinds of analysis, like market modeling projecting boston consulting group business plan growth and future share and detailed financial forecasting.


This process takes some time because ideas have to be analytically verified and consolidated, with the final call made by the executive team. An example is the strategy process in the core business of Mars. We can represent this planning process with the letter v. That is, starting from the top left of the vthe executive team sends the initial direction down to the business units the bottom of the vwhich send elaborated plans back to corporate, which finalizes the plan.


In less predictable environments, centralized cycles of planning make less sense. Instead, the strategic approach is to experiment and adapt rapidly to exploit unpredictably changing conditions. Here then, the process is about facilitating and capitalizing on experimentation.


This works best when experimentation happens in short cycles of testing and picking winners. Key ingredients of the process are the ability to collect and read signals to detect business opportunities; free flow of data throughout the company, enabling teams to identify opportunities with little central supervision; and the culture and organizational mechanisms to enable failures to be easily discontinued and successes to be scaled.


This process can be captured by the letter o, to represent short, iterative cycles of testing and identifying opportunities. A visionary approach works when the market is malleable to a particular company, so that rather than simply responding to given conditions, the company can create or shape a market around a transformative offering.


In this case, the job of the process is to facilitate imagination, home in on a visionary product, service, or business model, and then persist resourcefully to drive it into the market. Imagination works in iterative cycles, taking a starting point—often a desire, or a frustration that a need is not being met—and elaborating it into a worked-out proposal or prototype.


In popular stories of imagination, like that of Steve Jobs, this process is assumed to occur in the head of one person. But in fact it is a social process: at Apple, Steve Jobs elaborated his ideas by iterating with Jony Ive and others. To take another example, the concept behind 23andMe was formulated over time by Anne Wojcicki, drawing on her experience in health care and boston consulting group business plan in discussions with scientists and engineers.


Key ingredients of this process are the richness of mental models brought to bear on the initial ideas; a willingness to be patient with ideas still in formation; effective learning from prototypes; and a determination to persist until a market has been created.


It can be represented by the letter qwith the circular portion standing for imaginative boston consulting group business plan within the company. Then, once the visionary product has been created, it must be driven to market: the tail of the q. When an environment is malleable yet unpredictable—meaning it would be unwise to commit to a long-term visionary effort—an ecosystem or platform-based approach is appropriate. The strategy process here is about supporting effective collaboration to shape an unpredictable environment to the advantage of the company and others whose interests coincide.


Alibaba has done this exceptionally well, boston consulting group business plan, building a popular platform, engaging others, and shaping the direction of e-commerce in China, boston consulting group business plan. Another example is Red Hat, which creates open-source software by engaging a community of programmers, boston consulting group business plan. Success with this process requires building a platform to coordinate collaboration and co-evolving the offering in concert with other actors.


We can represent this process with a capital O. However, the larger size of the O signifies that the process encompasses actors beyond the bounds of the company. The job of the strategy process here is to facilitate fast interventions; it involves making pragmatic choices under pressure to find a path back to growth.


We can represent this process by Iindicating top-down, fast decision making that aims to ensure survival. Doing this well is difficult, as time and therefore the quality of information may be limited.


There is little scope for comprehensive analysis or engagement, internally or externally. Rather, a few critical turnaround initiatives must be driven from the top. An example is American Express in the harsh environment from to The five strategy processes described above are really points on a continuum. So we should also consider how they can be combined into variations appropriate to different circumstances. Two commonly employed variants illustrate this idea: v the planning process is often extended to become a w, indicating further rounds of iteration between corporate leadership and the business units.


Many other variations are possible. For example: multiple programs of experimentation run in a persistently unpredictable environment oo ; initial ecosystem engagement setting the direction for subsequent adaptive experimentation Oo ; an initial phase of experimentation informing an imaginative, visionary effort oq. The majority of companies employ a single strategy process—usually classical planning—rolled out uniformly, boston consulting group business plan.


But a large company almost always faces multiple business environments, across time or simultaneously in different parts of the company. Environments that are more or less predictable and malleable require different strategic approaches, each enacted via a suitable process.


Thus, business leaders and strategy departments need to be able to manage multiple variants of strategy processes, boston consulting group business plan. Such businesses need ambidexterity in processes, too, meaning that the different strategic approaches need to be successfully operationalized. How this should be done depends on diversity the variety of business environments the company faces and dynamism the frequency of change in those environments. Along these dimensions we can define four such metaprocesses.


See Exhibit 3. When the diversity of environments is high the business faces many kinds of environment at once but dynamism is low the set of environments stays the sameit makes sense to run separate strategy processes in parallel, overseen by corporate leadership. This requires leaders to be familiar with a range of approaches to strategy and the processes needed to enact boston consulting group business plan. They should be boston consulting group business plan of the different demands of each process and its expected outputs: annual plans from a classical unit, plausibly transformative ideas from a visionary unit, and so on.


When diversity is low but dynamism is high the firm faces just one kind of environment, say, but it changes over timeit makes sense to switch processes along with major shifts in the business context. This requires business leaders to regularly reassess the environment and be ready to change the boston consulting group business plan process as needed—even if this involves disruptive top-down interventions in existing ways of working. In diverse and dynamic situations, top-down management becomes too complex to be tenable.


The executive team should instead leave room for business units to self-organize, determining the most suitable strategy process given the environment that each faces at any given time. In the most diverse and dynamic situations, a firm may not be able to pursue the full suite of required processes internally and instead need to orchestrate an ecosystem, or multiple ecosystems, of external partners. In this case, leaders must do what they can to shape the ecosystem favorably, while collaborating with partners who may be running very different strategy processes.


This is often achieved indirectly via a digital platform, such as a two-sided marketplace. For example, Apple has a visionary process for many of its products, while within its app store, many companies run experimental, adaptive processes; at the same time, Apple collaborates with manufacturers that face comparatively predictable environments and employ classical strategy processes. But Apple profits by collaborating with multiple companies running different strategy boston consulting group business plan. Adopting multiple approaches and processes simultaneously requires a reconception of the role of the strategy department.


As the guardian of strategy, the strategy function should aim to move the organization away from a monolithic approach and towards an ambidextrous approach—developing the ability to implement a variety of strategy processes. The actions required to achieve this are:.


Units have a high degree of autonomy and the ability to run their own experiments. The central Alibaba planning process leaves space for this: plans are written as starting points rather than ends in themselves, and business unit leaders are allowed to explore new directions. Finally, boston consulting group business plan, when change is boston consulting group business plan but difficult, Alibaba still has the ability to initiate tightly executed programs from the top, best illustrated by the significant number of reorganizations the company boston consulting group business plan gone through over the course of its growth.


Even for those leaders who understand that varied approaches to strategy are required, boston consulting group business plan, it can be difficult to realize these organizationally. Companies are often stuck with a classical plan-and-execute process that is as much boston consulting group business plan embedded mindset as a set of collective routines. To best take advantage of each environment a firm faces, we need to actively consider the right strategic approaches and enact these effectively by adopting the right processes.


The Institute engages leaders in provocative discussion and experimentation to expand the boundaries of business theory and practice and to translate innovative ideas from within and beyond business. For more ideas and inspiration from the Institute, please visit Featured Insights. Log in Log error View Profile Edit Profile Manage Subscriptions My Saved Content Logout. Your Strategy Process Needs a Strategy.


November 14, By Martin ReevesJulien Legrandand Jack Fuller. The Challenges of Different Environments As business environments have grown more diverse in recent decades, picking the right approach to strategy for each context has become increasingly important. Classical: Planning The essence of the classical approach is to create and implement a stable plan of action, which works best when the environment is relatively predictable.


Adaptive: Experimentation In less predictable environments, centralized cycles of planning make less sense. Visionary: Imagination A visionary approach works when the market is malleable to a particular company, so that rather than simply responding to given conditions, the company can create or shape a market around a transformative offering.


Shaping: Collaboration When an environment is malleable yet unpredictable—meaning it would be unwise to commit to a long-term visionary effort—an ecosystem or platform-based approach is appropriate. Managing Multiple Strategy Processes The majority of companies employ a single strategy process—usually classical planning—rolled out uniformly.


High Diversity, Low Dynamism: Separation When the diversity of environments is high the business faces many kinds of environment at once but dynamism is low the set of environments stays the sameit makes sense to run separate strategy processes in parallel, overseen by corporate leadership. Low Diversity, High Dynamism: Switching When diversity is low but dynamism is high the firm faces just one kind of environment, say, but it changes over timeit makes sense to switch processes along with major shifts in the business context.




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boston consulting group business plan

boston consulting group templates toolkit (9) We have assembled 9 documents in the Boston Consulting Group Templates Toolkit, listed below. Under the list of documents, you can add the entire toolkit to your shopping cart by clicking the "Add All to Cart" button in green BCG experts help clients build a robust internal pricing organization—a core part of our work—because pricing needs to be a core part of yours. Marketing Function Excellence. Marketing organizations are expected to respond quickly to changing conditions, and the job of marketers has grown more complex Jul 18,  · Boston Consulting Group partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities. BCG was the pioneer in business strategy when it was founded in Estimated Reading Time: 9 mins

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