Business and Competitive Analysis: Effective Application of New and Classic Methods, 2nd Edition

About

Features

The #1 guide to modern business and competitive analysis – now fully updated with new methods, applications, and examples.

• All the tools you need to transform data into actionable business insights and recommendations
• Presents the authors’ widely-praised FAROUT method for choosing the right tools for each assignment
• Ranges from classic tools (McKinsey 7S) to emerging techniques from economics, finance, sociology, anthropology, and the intelligence and futurist communities
• Offers clear descriptions of each tool, with context, strategic rationales, strengths, weaknesses, step-by-step instructions, and references for further exploration

Description

Meet any business or competitive analysis challenge: deliver actionable business insights and on-point recommendations that enterprise decision makers can’t and won’t ignore! All you need is one book: Business and Competitive Analysis, Second Edition. This generation’s definitive guide to business and competitive analysis has now been thoroughly updated with additional methods, applications and examples. Craig S. Fleisher and Babette E. Bensoussan begin with a practical primer on the process and context of business and competitive analysis: how it works, how to avoid pitfalls, and how to communicate results. Next, they introduce their unique FAROUT method for choosing the right tools for each assignment. The authors then present dozens of today’s most valuable analysis methods. They cover “classic” techniques, such as McKinsey 7S and industry analysis, as well as emerging techniques from multiple disciplines: economics, corporate finance, sociology, anthropology, and the intelligence and futurist communities. You’ll find full chapters outlining effective analysis processes; avoiding pitfalls; communicating results; as well as drill-downs on analyzing industries, competitive positioning, business models, supply chains, strategic relationships, corporate reputation, critical success factors, driving forces, technology change, cash flow, and much more. For every method, Fleisher and Bensoussan present clear descriptions, background context, strategic rationales, strengths, weaknesses, step-by-step instructions, and references. The result is a book every analyst, strategist, and manager can rely on – in any industry, for any challenge.

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Business and Competitive Analysis: Definition, Context, and Benefits

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Table of Contents

Preface     xxix
SECTION 1:  ESSENTIALS OF PERFORMING BUSINESS AND COMPETITIVE ANALYSIS
Chapter 1  Business and Competitive Analysis: Definition, Context, and Benefits     3
   Understanding the Terminology     4
      Competitive     4
      Strategic     5
      Analysis     6
      Intelligence     8
   Analysis as a Component in the Intelligence Cycle     10
   Competitive Analysis and Decision Making     11
      The Competitive Context Facing Contemporary Enterprises     13
      Contemporary Context Facing the Analyst     14
   Shifting Organizational Priorities for Analysts and Analysis     16
   Summary     17
   References     18
Chapter 2  Performing the Analysis Process     22
   Understanding the “Customers” of Your Analysis Work     23
      Defining the Analysis Problem     25
      Identifying the Scope of the Analysis     26
   Intelligence Analysis at Differing Organizational Levels     31
      Strategic Intelligence Analysis     32
      Tactical Intelligence Analysis     32
      Operational Intelligence Analysis     33
      Micro Intelligence Analysis     33
   Evaluating the Inputs to Analysis     34
   Making Sense of the Analysis     37
      Facts     37
      Perceptions     38
      Beliefs     38
      Assumptions     38
      Projections     38
      Synthesis     39
   Infrastructure to Support the Analysis Process     39
      Intelligence Solutions     40
      Limitations of Intelligence Solutions     40
      Managing the Internal Network     41
      Developing and Managing the External Network     42
      Proactivity, Efficiency, and Perpetual Learning     43
   Summary     44
      Fleisher and Bensoussan’s 10 Commandments for Business and Competitive Analysis     45
   References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Chapter 3  Avoiding Analysis Pitfalls by Developing Analytical Fitness     48
   Trade-Offs Made by Analysts     48
   Analysis of Failure     49
      Failure Location     49
      Sources of Failure     50
   Four-Level Hierarchical Model of Analysis Failures     51
      Individual Analyst-Level Failures     53
      Analysis Task-Level Failures     55
      Internal Organizational-Level Failures     57
      External Environment-Level Failures     59
   The Movement to a New Generation of Analysis     62
   Overcoming the Barriers and Improving Performance through Developing Analytical Fitness     63
   Summary     65
   References     66
Chapter 4  Communicating Analysis Results     69
   The Art of Effective Communication     69
   Packaging the Results of Your Analysis     71
   Delivering the Message     71
      Face-to-Face Briefings     72
      Written Reports and Briefings     72
      Presentations in Meetings, Seminars, and Workshops     72
      E-Mail/Instant Messaging     73
      Web-Based Intelligence Solutions and Systems     73
      Exercises and Planning Sessions     74
   Common Products and Reports Used by Analysts     74
      News Bulletins and Newsletters     74
      Assessments     76
      Competitor Profiles     76
      Battlecards     76
      Strategic Impact Worksheets     77
      Intelligence Briefings     77
      Situation Analysis     78
      Special Intelligence Summaries     78
   Creating the Report     78
   Communication Difficulties Faced by Analysts     79
   Effective Listening and Answering the Questions of Decision Makers     86
   Conduct Communication Follow-Up and Gather Feedback     87
   Pragmatic Considerations     87
   Summary     89
   References     90
Chapter 5  Applying the FAROUT Method     92
   Applying the Techniques     94
   An Evaluation Scheme for Assessing the Adequacy of Tools and Techniques: FAROUT     95
      Using the FAROUT Rating System     98
   References     101

SECTION II:  NEW AND CLASSIC METHODS OF BUSINESS AND COMPETITIVE ANALYSIS
Chapter 6  A Better SWOT Analysis     105
   Background     105
   Strategic Rationale and Implications     107
   Key Intelligence Topics and Questions     110
   Strengths and Advantages     111
   Weaknesses and Limitations     112
   Process for Applying the SWOT Technique     113
   Worksheet     119
   FAROUT Summary     120
   Related Tools and Techniques     122
   References     122
Chapter 7  Analysis of Competing Hypotheses     123
   Background     123
   Strategic Rationale and Implications     124
   Key Intelligence Topics and Questions     125
   Strengths and Advantages     126
   Weaknesses and Limitations     127
   Process for Applying the Technique     128
      Step 1: Identify the Possible Hypotheses to Be Considered     128
      Step 2: List the Significant Evidence in Support of and Against Each Hypothesis     128
      Step 3: Prepare a Matrix with Hypotheses Across the Top and Evidence Down the Side     129
      Step 4: Refine the Matrix     130
      Step 5: Draw Tentative Conclusions About the Relative Likelihood of Each Hypothesis by Trying to Disprove It     131
      Step 6: Analyze How Sensitive Your Conclusion Is to a Few Critical Pieces of Evidence     132
      Step 7: Report Conclusions     132
      Step 8: Identify Milestones for Future Observation That May Indicate Events Are Taking a Different Course Than Expected     133
   Summary     133
   Worksheet     133
   FAROUT Summary     134
   Related Tools and Techniques     136
   References     136
Chapter 8  Benchmarking Analysis     137
   Background     137
   Strategic Rationale and Implications     138
   Taxonomy of Benchmarking     139
   Key Intelligence Topics and Questions     143
   Strengths and Advantages     144
   Weaknesses and Limitations     145
   Process for Applying the Technique     147
      Step 1: Identify the Processes That Need to Be Benchmarked     147
      Step 2: Identify Performance Measures     148
      Step 3: Evaluate Your Own Firm’s Capabilities     150
      Step 4: Identify Firms to Be Benchmarked     150
      Step 5: Conduct Research of Selected Firms     151
      Step 6: Analyze the Collected Data and Develop an Action Plan     152
   Worksheet     155
   FAROUT Summary     156
   Related Tools and Techniques     157
   References     157
Chapter 9  Business Model Analysis     159
   Background     160
   Strategic Rationale and Implications     161
      The Business Model     162
      Classification of Business Models     164
   Key Intelligence Topics and Questions     167
   Strengths and Advantages     167
   Weaknesses and Limitations     168
   Process for Applying the Technique     168
      Step 1: Articulate the Value Proposition     168
      Step 2: Specify the Target Segment     170
      Step 3: Determine Competitors     170
      Step 4: Evaluate the Value Chain and the Cost Model     171
      Step 5: Evaluate the Value Network     173
      Step 6: Determine the Revenue Model for the Firm     174
      Step 7: Determine the Critical Success Factors for the Industry     175
      Step 8: Complete an Analysis Grid Detailing Each Element of the Business Model     175
   Worksheet     179
   FAROUT Summary     179
   Related Tools and Techniques     181
   References     181
Chapter 10  Competitive Positioning Analysis     183
   Background     183
   Strategic Rationale and Implications     184
      Develop and Build on the Firm’s Position     185
      Maintain and Hold the Firm’s Strong Market Position     186
      Defend a Dominant Position     186
      Withdraw from a Market     186
   Key Intelligence Topics and Questions     187
   Strengths and Advantages     187
   Weaknesses and Limitations     188
   Process for Applying the Technique     189
      Step 1: Identify Current Strategy and Market/Product/Project Parameters     190
      Step 2: Conduct Analysis     192
      Step 3: Review Results and Formulate Positioning Strategy     193
   Summary     195
   Worksheet     197
   FAROUT Summary     198
   Related Tools and Techniques     200
   References     200
Chapter 11  Competitor Cash Flow Analysis     202
   Background     202
   Strategic Rationale and Implications     204
   Key Intelligence Topics and Questions     206
   Strengths and Advantages     207
   Weaknesses and Limitations     208
   Processes for Applying the Technique     209
      Future Cash Flow Analysis     210
      Tip Sheet on Cash Flow Analysis     211
   Worksheet     218
   FAROUT Summary     219
   Related Tools and Techniques     220
   References     221
Chapter 12  Critical Success Factors Analysis     222
   Background     222
   Strategic Rationale and Implications     224
   Key Intelligence Topics and Questions     229
   Strengths and Advantages     229
   Weaknesses and Limitations     230
   Process for Applying the Technique     231
      Leidecker and Bruno’s Identification Techniques     232
      Determining Critical Success Factor Importance     236
   Worksheet     238
   FAROUT Summary     239
   Related Tools and Techniques     240
   References     241
Chapter 13  Driving Forces Analysis     243
   Background     243
   Strategic Rationale and Implications     244
   Key Intelligence Topics and Questions     244
   Strengths and Advantages     245
   Weaknesses and Limitations     246
   Process for Applying the Technique     246
      Step 1: Identifying an Industry’s DFs     247
      Step 2: Assessing the Impact of the DFs     250
   Worksheet     258
   FAROUT Summary     259
   Related Tools and Techniques     260
   References     261
Chapter 14  Event and Timeline Analysis     263
   Background     263
   Strategic Rationale and Implications     264
   Key Intelligence Topics and Questions     265
   Strengths and Advantages     265
   Weaknesses and Limitations     266
   Process for Applying the Technique     267
      Plot the Target Firm’s History of Key Events on a Line     267
      Develop a Chronological Table of Events     269
      Develop an Events Matrix     270
      Event and Causal Factors Analysis     270
   Worksheet     278
   FAROUT Summary     278
   Related Tools and Techniques     280
   References     280
Chapter 15  Historiographical Analysis     282
   Background     282
   Strategic Rationale and Implications     283
   Key Intelligence Topics and Questions     285
   Strengths and Advantages     286
   Weaknesses and Limitations     287
   Process for Applying the Technique     288
      Step 1: Develop a General Proposition About the Analytical Target     288
      Step 2: Collect Primary Information     289
      Step 3: Collect and Relate Secondary Information     289
      Step 4: Cross-Reference and Select the Best Sources for the Third Draft     290
      Step 5: Analysis, Validation, and Reporting     290
   Worksheet     292
   FAROUT Summary     293
   Related Tools and Techniques     294
   References     295
Chapter 16  Indications and Warning Analysis     296
   Background     296
   Strategic Rationale and Implications     298
   Key Intelligence Topics and Questions     299
   Strengths and Advantages     299
   Weaknesses and Limitations     300
   Process for Applying the Technique     302
      Step 1: Establish a Set of Indicators     302
      Step 2: Establish Meaning Behind Indicators     304
      Step 3: Validate and Rank Indicators Against Threshold Levels to Determine When Warnings Need to Be Issued     306
      Step 4: Determine and Recommend Appropriate Firm Responses to the Warning     307
   Worksheet     308
   FAROUT Summary     309
   Related Tools and Techniques     311
   References     311
Chapter 17  Industry Fusion Analysis     313
   Background     313
      General Environment     314
      Operating Environment/Industry Analysis     317
      Internal Environment     318
   Strategic Rationale and Implications     318
   Key Intelligence Topics and Questions     320
   Strengths and Advantages     321
   Weaknesses and Limitations     322
   Process for Applying the Technique     323
   Worksheet     330
   FAROUT Summary     331
   Related Tools and Techniques     332
   References     332
Chapter 18  Interpretation of Statistical Analysis     335
   Background     335
   Strategic Rationale and Implications     336
   Key Intelligence Topics and Questions     337
   Strengths and Advantages     338
   Weaknesses and Limitations     338
   Process for Applying the Technique     339
      Percentage Changes     339
      Percentiles and Quartiles     341
      Normal Distribution and Bell Curve     341
      Summarizing Data with One Value–Central Tendency     342
      Standard Deviation     344
      Comparing Data     345
      Regression Analysis     346
      Correlation     350
      P-Values     351
   Worksheet     351
   FAROUT Summary     352
   Related Tools and Techniques     353
   References     354
Chapter 19  Linchpin Analysis     355
   Background     355
   Strategic Rationale and Implications     356
   Key Intelligence Topics and Questions     359
   Strengths and Advantages     360
   Weaknesses and Limitations     360
   Process for Applying the Technique     361
      Linchpin Assumption Sensitivity Analysis     362
      Process for Using Linchpin Analysis in Assessing Risk     363
   Worksheet     364
   FAROUT Summary     365
   Related Tools and Techniques     366
   References     367
Chapter 20  McKinsey 7S Analysis     368
   Background     368
   Strategic Rationale and Implications     371
   Key Intelligence Topics and Questions     372
   Strengths and Advantages     373
   Weaknesses and Limitations     374
   Process for Applying the Technique     375
   Worksheet     381
   FAROUT Summary     381
   Related Tools and Techniques     383
   References     383
Chapter 21  Product Line Analysis     385
   Background     385
   Strategic Rationale and Implications     386
   Key Intelligence Topics and Questions     386
   Strengths and Advantages     387
   Weaknesses and Limitations     388
   Process for Applying the Technique     389
      Step 1: Initial Product Audit     389
      Step 2: Assess the Product Relative to Its Position in the Product Life Cycle     390
   Worksheet     401
   FAROUT Summary     403
   Related Tools and Techniques     404
   References     405
Chapter 22  Scenario Analysis     407
   Background     407
   Strategic Rationale and Implications     408
      Methods for Generating Scenarios     408
      Quantitative Method: Computer-Generated Econometric Model     409
      Qualitative Methods     409
   Key Intelligence Topics and Questions     411
   Strengths and Advantages     412
   Weaknesses and Limitations     413
   Processes for Applying the Technique     413
   Worksheet     421
   FAROUT Summary     422
   Related Tools and Techniques     424
   References     424
Chapter 23  SERVO Analysis     425
   Background     425
      Strategy     426
      Environment     427
      Resources     428
      Values     430
      Organization     431
   Strategic Rationale and Implications     432
   Key Intelligence Topics and Questions     433
   Strengths and Advantages     434
   Weaknesses and Limitations     434
   Process for Applying the Technique     435
      Step 1: Evaluate the Current Performance of the Firm     435
      Step 2: Assess the Current Strategy and Discern Whether Change Is Necessary     436
      Step 3: Develop and Evaluate Strategic Options and Programs     439
   Worksheet     442
   FAROUT Summary     443
   Related Tools and Techniques     444
   References     445
Chapter 24  Shadowing     447
   Background     447
   Strategic Rationale and Implications     450
   Key Intelligence Topics and Questions     451
   Strengths and Advantages     451
   Weaknesses and Limitations     452
   Process for Applying the Technique     454
      Team Composition     454
      Team Structure     455
      Performance Goals     455
      Shadowing     456
      Developing a Shadow Market Plan     458
   Mini Case Studies     461
      Case 1: Deregulating Utility     461
      Case 2: Packaged-Food Multinational     461
      Case 3: Ready-to-Eat Foods     461
      Case 4: Pharmaceutical Firm     462
   Worksheet     462
   FAROUT Summary     463
   Related Tools and Techniques     464
   References     465
Chapter 25  Strategic Relationship Analysis     466
   Background     466
   Strategic Rationale and Implications     469
      Purposes Served by SRs     469
      Two Key Strategic Relationship Processes     472
   Key Intelligence Topics and Questions     473
   Strengths and Advantages     474
   Weaknesses and Limitations     475
   Process for Applying the Technique     475
      Studying Your Own Firm’s Relationship Formation Readiness     475
      Studying a Rival’s Relationships     478
   Worksheet     485
   FAROUT Summary     486
   Related Tools and Techniques     487
   References     488
Chapter 26  Supply Chain Management (SCM) Analysis     492
   Background     493
   Strategic Rationale and Implications     494
   Key Intelligence Topics and Questions     496
   Strengths and Advantages     497
   Weaknesses and Limitations     498
   Process for Applying the Technique     499
      Rules and Tools     501
   Worksheet     507
   FAROUT Summary     508
   Related Tools and Techniques     510
   References     510
Chapter 27  Technology Forecasting     513
   Background     513
   Strategic Rationale and Implications     515
   Key Intelligence Topics and Questions     518
   Strengths and Advantages     518
   Weaknesses and Limitations     519
   Process for Applying the Technique     521
      1. Expert Opinion     522
      2. Trend Extrapolation     523
      3. Growth Curves     525
      4. Historical Analogy     526
      5. Scenarios     526
      6. Modelling, Simulations, and Gaming     526
      7. Morphological Analysis     527
      8. Relevance Trees     527
      9. Monitoring     528
      10. Creativity Stimulators     529
   Using the Information     531
   Worksheet     535
   FAROUT Summary     535
   Related Tools and Techniques     537
   References     537
Chapter 28  War Gaming     539
   Background     539
   Strategic Rationale and Implications     540
   Key Intelligence Topics and Questions     541
   Strengths and Advantages     542
   Weaknesses and Limitations     543
   Process for Applying the Technique     544
      Step 1: Is a War Game the Way to Go?     545
      Step 2: Getting a Business War Game Off the Ground     546
      Step 3: Who Should Play?     548
      Step 4: Preparing for Your War Game     548
      Step 5: Playing the Game     549
      Step 6: After the Game     550
   Worksheet     552
   FAROUT Summary     553
   Related Tools and Techniques     554
   References     555
Chapter 29  Win/Loss Analysis     556
   Background     556
   Strategic Rationale and Implications     557
   Key Intelligence Topics and Questions     559
   Strengths and Advantages     560
   Weaknesses and Limitations     561
   Process for Applying the Technique     562
      Step 1: Determine the Target Segments and Identify Prospects     562
      Step 2: Understand Internal Cultural Issues     563
      Step 3: Develop the Questionnaire     563
      Step 4: Prepare for the Interviews     564
      Step 5: Conduct Interviews     564
      Step 6: Analyze and Interpret     565
      Step 7: Disseminate     565
   Worksheet     568
   FAROUT Summary     570
   Related Tools and Techniques     571
   References     571
Index     573

The definitive practical guide to business and competitive analysis, now fully updated: all the tools, step-by-step instructions for using them, and expert guidance on choosing the right tool for every assignment!

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