Homework, Part 2, Questions 4 to 7
|Q4 – By the Numbers: I/O or RBV?||15|
|Q5 – SWOT Analysis||15|
|Q6 – Using SWOT to Improve Your Company||8|
|Q7 – Using SWOT to Beat Your Company||8|
|Formatting & Style||9|
|Total (note 5 points of bonus)||50|
Assume that you are a consultant hired by a firm to conduct a strategic analysis for your target firm. The homework requires that you answer the questions analytically and systematically. Please answer the following questions. Make sure to include references for any sources of information or data that you use that is not your own.
Formatting & Style Guidelines – As with other slide deck assignments, you may use smaller fonts and have more text on your slides than you would have in a classroom-style presentation. Your slides should:
- Be professionally formatted
- Have meaningful titles
- Make use of tables and bullets, as appropriate
- Have a consistent “feel” from slide to slide
- Be dark text on a light background
- Avoid fluff (1- to 3-word blurbs; avoid generic/vague language)
- Be self-explanatory to the audience; it should be clear what is happening on each slide, which company you are covering, etc.
- (15 points; 2 slides) In the Industrial Organization (I/O) view of the firm, performance is driven by a firm’s industry. In the Resource-Based View (RBV) of the firm, company performance is driven by its unique resources and capabilities. The entire point of this question is to determine the most likely explanation for your company’s performance.
- Calculate and compare your company’s financial performance to that of a competitor.Be sure to clearly indicate Advantage, Disadvantage or Parity between the two companies. Parity should be taken as a variation of 10% or less between your company and its competitor (to find this out for a given ratio, divide your company’s value by the competitor’s; if the result isbetween 0.90 and 1.10, then it’s parity). Please compare based on:
- Inventory Turnover Ratio (COGS / Average Inventory)
- Asset Turnover Ratio (Net Revenues / Average Total Assets)
- Current Ratio (Current Assets / Current Liabilities)
- Debt-to-Equity Ratio (Total Debt / Total Equity)
- Gross Profit Margin (Gross Income / Net Revenue)
- Net Profit Margin (Net Income / Net Revenue)
- Return on Equity (Net Income / Total Equity)
- Using only your answer from (a) above, explain whether your company’s performance reflects the I/O view (mostly parities) or the RBV (mostly significant differences, either advantages or disadvantages). NOTE: you MUST explain your reasoning here.Please note that it is impossible to answer Part B without talking about Part A in detail.
- (15 points; 1-2 slides) Do a SWOT analysis for your company. You should be using Part 1 of your Homework to help you here. Identify 3-5 each of Strengths, Weaknesses, Opportunities and Threats for your company. Note that this ends up being 12-20 overall major points. Take special care to distinguish between internal (S&W) and external (O&T).
- (8 points; 1 slide) Recommendation time. Using your previous analyses (including Part 1 of the Homework, which should help you in your SWOT), please make at least 3 recommendations to improve your company in the coming years.
- (8 points; 1 slide) Now offer a competitor a plan to beat your company. Assume you have been hired by your company’s competitor. If you were giving advice to that competitor, how would you tell them to beat your company? Note: imitation is a thing that can help generate a tie, but not a win; as well, the second mover is generally going to lose in an imitation battle. We play to win the game.
- Offer at least 3 recommendations to help your competitor defeat your target company, taking care to explain WHY you made that recommendation. Note that these recommendations should be informed at least in part by material from the previous questions. (For example, you could recommend the competitor take advantage of one of your company’s weaknesses.)
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