BAIN战略分析工具PROFIT POOL

1、Profit Pools and Core CompetenceDarral G ClarkeProfessor of ManagementThe Marriott SchoolBrigham Young University2021-11-231Profit Pools: A Fresh Look at StrategyOrit Gadiesh and James L. GilbertHarvard Business ReviewMay-June 19982021-11-232THE PC INDUSTRYS PROFIT POOLnValue chain focusnAxesnVertic

2、aloperating marginnHorizontalshare of industry data40%30201000100%share of industry revenuemicroprocessorsother componentspersonal computerssoftwareperipheralsservicesThe value chain for the PC industry includes six key activities; the profitability of the activities varies widely. Manufacturers com

3、pete in the largest but least-profitable segment of the chain.2021-11-233The Profit Pool LensnThe profit pool is the total profit earned in an industry at all points along the industrys value chainnSegment profitability may vary by customer group, product category, geographic market, or distribution

4、 channelnProfit concentration may be very different than revenue concentrationnShape of the profit pool reflects the competitive dynamics of a business Interactions of companies and customers Competitive strategies of competitorsnProduct pools are not stagnant2021-11-234THE U.S. AUTO INDUSTRYS PROFI

5、T POOL100%operating marginsource: Harvard Business Review, May-June 1998auto rental25%1510500share of industry revenueauto manufacturingnew car dealersused car dealersauto loansauto insuranceaftermarket parts20leasingwarrantygasolineservice repairThe automotive industry encompasses many value-chain

6、activities. The way that profits and revenues are distributed among these activities varies greatly. The most profitable areas of the car business are not the ones that generate the biggest revenues.2021-11-235Profit Pools: Company ExamplesCompaniesAutomakersU-HaulElevators (OTIS)Harley DavidsonPola

7、roidCore BusinessAuto manufacturingTruck RentalElevator ManufacturingMotorcyclesInstant Photography CamerasSources of Highest ROIAuto leasing, insurancePacking materials, storageServiceAccessories (consumer products), leasing, service, restaurantsFilm2021-11-236Managerial ImplicationsnFocus on growt

8、h and market share can lead a company to focus on unprofitable segments of an industrynTodays deep revenue revenue pool may be tomorrows dry hole.nThe goal should be to focus on profitable opportunitiesnIndustry should be considered more broadly than traditional definitionnAutomobile industry includ

9、es Component manufacture and supply New car assembly and delivery New car warrantee and service New car financing and insurance Used car sales and service2021-11-237Turbulent industriesnProfit pools are especially important and useful in industries undergoing deregulation and/or technological change

10、nSuch changes can open new profit pool opportunities and drain old onesnChoke points may change or be eliminatednOpportunities for either forward or vertical integration may emergenCurrent vertical integration may be disintermediated2021-11-238Creating and managing a profit poolnProfit pool analysis

11、 may indicate new opportunities or threatsnImperativesnBe open to a new perspective on your business and industrynDeveloping new strategy may require overturning elements of the current strategynBe open to reevaluate the role played by current competitorsnBe vigilant to identify possibility that new

12、 entrants may seek to enter your industry with radical strategies 2021-11-239Looking Ahead: Profit Pools and the Five ForcesnProfit pools are computed by multiplying the size of the revenue by the unit profit marginnEssentially an accounting process- no theorynMost valuable in situations in which ex

13、ternal conditions are essential stable and/or unimportantn(Often dominated by internal data alone)nThe five forces tells us (which will study next)nthe underlying determinants that determine both the revenue size and the unit profit marginnThe profit drivers which allow us to forecast the direction

14、of change2021-11-2310Marakon RunnersThomas A. StewartFortuneSept. 28, 19982021-11-2311Marakon Associatess Approach to Corporate StrategynConsultants to many large corporationsnCoca Cola, HP, GM, CitiCorp, etc.nClients have returns 3.1% higher than industry peer groupnGoal is to increase shareholder

15、value through analysis of economic profitnDeep drilling in business data to measure value creation Product segments Customer segments2021-11-2312How Strategy HappensnLearning where value is creatednWaterfall charts by product and customer segmentsnEvaluating strategynIndustry average profit per unit

16、nCompanys profit vs industry averagenManaging valuenCurrent strategynChange product focusnChange customer focus2021-11-2313Learning where value is createdProduct segmentsCustomer segmentsProfit/loss ($ per unit)Volume (units)Volume (units)02021-11-2314Evaluating StrategyCompany profit per unitIndust

17、ry-average profit per unit2021-11-2315Managing for valueCurrentstrategyChangeproductfocusChange CustomerfocusValue2021-11-2316Application to our casesnRetail industry (Wal*Mart)nSoft drink industry (Coca-Cola and PepsiCo) nSteel (Nucor) and aluminum cans (CC&S)nHi tech (Intel, Cisco, and Dell)nV

18、ideo games (Nintendo)nWeb businesses (eBay and Yahoo!)2021-11-2317The Core Competence of the CorporationPrahalad, C. K. and Gary HamelHarvard Business Review, May-June 19902021-11-2318Core CompetencenA Firm is made up of resourcesnpeople, patents, brand names, plant &equipment, processes, etcnA

19、competence is the ability to employ diverse skills and resources to perform tasks and activities.nA core competence is a broadly based and/or a broadly applied fundamental capability. 2021-11-2319Competence and TechnologynCompetence is not the same as technologynCompetence requiresntechnologiesnsoci

20、al organizationncollective learning2021-11-2320Core competence questions:nWhat are we really good at?nHow can we build upon it?nWhat do we need to be good at?2021-11-2321Characteristics of Effective CompetenciesnDurability: Technical equipment can be short lived. Reputation or knowledge may deprecia

21、te more slowly.nTransparency: The more complex the source of competence, the harder it is to imitate it.nTransferability: The availability of resources to competitors.nReplicability: A competitors internal ability to replicate a competence using available resources.2021-11-2322Choosing Competenciesn

22、How central is this competence to our success in the market?nHow long could we preserve our competitiveness in this business without this particular competence?nWhat future opportunities would be foreclosed if we were to lose this particular competence?2021-11-2323Core Competence and Core ProductsEn

23、dProducts/ServicesCore ProductsCore Competence2021-11-2324A Hierarchy of CompetenciesSupplemental CapabilitiesEnabling CapabilitiesCore Capabilities2021-11-2325Building Strategy from CapabilitiesStrategyCapabilitiesResources1. Identify resources, appraiserelative strengths and weaknesses. Leverage u

24、se of resources2. Identify capabilities. What do we domore effectively than competitors? Identify resource inputs to capabilities.3. Appraise rent-generating potential resources and capabilities in terms of:sustainable advantage, inappropriability4. Select strategy that best exploits the firms resou

25、rces and capabilities rela-tive to external opportunities.5. Identify resourcegaps that need to befilled.Invest in replenishing,augmenting, and up-grading the firmsresource base.CompetitiveAdvantageSource: Robert M. Grant, “The Resource-Based Theory of Competitive Advantage,”California Management Re

26、view, Spring,1991, page 151.2021-11-2326How to map your industrys profit poolOrit Gadiesh and James L. GilbertHarvard Business ReviewMay-June 19982021-11-2327A straight forward exercise with complicationsnConcept is straight forwardnDefine value chain activitiesnDetermine their size and profitabilit

27、ynApplication of concept is complicatednFinancial data doesnt correspond to value chain activitiesnCompany data is aggregated across businessesnProducts, customer purchases, channel volumes rarely match up with boundaries of an activitynConsiderable creativity is required2021-11-2328Four step proces

28、snDefine the poolnDetermine the size of the poolnDetermine the distribution of profitsnReconcile the estimates2021-11-2329Four step processDefine the poolDetermine the size of the poolDetermine profit distributionReconcile the estimatesTask: determine which value-chain activity influence profits now

29、 and in the futureDevelop a baseline estimate of cumulative profits generated by all profit pool activitiesDevelop estimate of the profits generated by each activityCompare the outputs of steps 2 & 3GuidelinesTake a broad view of the value chain(beyond traditional industry definition)Seek a roug

30、h but accurate estimateShift between aggregation and disaggregation in your analysisIf numbers dont add up,Check assumption and calculationsExamine industry from three perspective: own, other players, customersTake easiest route: go where the data areDo own economics first, then large pure players,

31、large mixed, smallerCollect additional dataDont disaggregate more than necessaryTake at least two viewpoints: company level and product levelUse proxy measures where necessaryResolve inconsistenciesdont ignore themOutputProfit pool listEstimate of total pool profits, (range)Point estimate of profits for each value chain activityFinal estimates of activity and total pool profits2021-11-2330What is “profit” anyway?nCan be thought of in three ways (all of which may be relevant for profit pool analysis