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So I'm FINALLY in my final semester (august 25 will be the first day of my final semester), and I'm having to do a capstone project worth a HUGE chunk of my grade and if done well enough could be a bright star on my resume.......
I've never done one, and I'm going to have to write this without my usual backup help (they is a tutoring center on campus, free for students, and they have helped me clean up alot of my papers in the past....mostly punctuation rules and some grammar).
So here is the prompt that my teacher has given us....
I've never done one, and I'm going to have to write this without my usual backup help (they is a tutoring center on campus, free for students, and they have helped me clean up alot of my papers in the past....mostly punctuation rules and some grammar).
So here is the prompt that my teacher has given us....
Industry Analysis Project
Scenario: You work as an analyst for a very successful venture capitalist. Recently, your boss has divested a number of businesses and she is eager to reinvest the capital that has been freed up from these divestments. She has instructed you to identify an industry that has significant growth potential and the prospect for long-term profitability. You know from working with her over the last 3 years that she likes to invest in those industries that are straightforward and generally easy to understand how they create value for the consumer and for society as a whole. Therefore she likes to invest in industries that create tangible products or services, she doesn’t like financial services.
After selecting an industry, you will then need to make recommendations to her regarding the best way to enter that industry, either through acquisition or through a startup venture. You must weigh the pros and cons of each approach and recommend the one approach you think is best based on the evidence of your research and knowledge of strategic management.
You also need to know that your boss demands careful and thorough analysis. With this in mind, a well-argued recommendation requires careful and systematic application of strategic management theory and its analytical frameworks to provide the necessary structure and logic to help you make your case with the data and evidence that you collect during your research. It is imperative that you carefully select the sources of information you rely on.
Sources of Information: For this assignment, you should make good use of IBIS World as well as other relevant and reputable sources you discover. You will need to reference and cite these sources in a reference section at the end of your document where your sources of information are cited in APA format.
In your analysis, consider the following:
1) Dominant Economic Characteristics of the Industry
a) Market size and growth rate over the past 10 years and projected growth rates
b) Stage in the industry life cycle
c) Number and sizes of competitors
d) Average profitability of the industry over the last 5 years and projected profitability
e) Do these economic characteristics indicate growth potential and long term profitability? Why?
2) Identify the driving forces of change that are impacting the industry and company
a) Analysis of general environment:
i) What are the dominant influential forces of change in the industry?
ii) Do they present a significant opportunity or threat to the industry?
iii) On balance, do these forces provide a significant opportunity for growth and profitability?
b) Analysis of competitive environment:
i) Assess the level of competition in the industry (5 forces analysis)
(1) Level of rivalry of incumbent firms
(2) Threat of substitutes (assess the barriers to entry)
(3) Threat of substitutes
(4) Relative level of buyer power and supplier power.
ii) How do these forces of competition impact the level of profitability of the industry?
iii) On balance, do they represent opportunities that can be profitably pursued, or are they threats that are difficult to overcome?
3) Identify the critical success factors of this industry (Critical success factors are those areas and aspects of the business that firms must be good at to be profitable and succeed):
a) Based on these critical success factors, which activities in the value chain seem most critical? Why?
b) What does this suggest about the core competencies of successful firms in this industry?
i) How difficult or costly is it to acquire or build these competencies?
ii) Are these competencies easy to copy?
4) Identify the business-level strategies of the successful firms in this industry (Low cost and/or differentiation?)
a) How well positioned are the top firms in this industry? Which strategies do they employ? How are they performing relative to the industry average?
b) Is there “space” in the industry to establish a strong competitive position whilst avoiding direct competition from the incumbent firms? It might be good to do a quick strategic group analysis.
c) How difficult would it be to establish a distinct and effective competitive position?
d) Given the critical success factors and the competitive strategies of incumbent firms, what type of strategy would it likely be? (Low cost, differentiation or focus strategy?)
5) Executive Summary of Analysis and Recommendations:
Your analysis should be written in a format that is appropriate for a busy executive (not in “term paper” form). I would like you to write the document in the format of an extended “executive summary” which should be no more than 3 single-spaced pages. It needs to be a professional and persuasive well-argued recommendation that relies on thorough systematic application of the strategic management theory and analytical frameworks and supported with carefully selected and presented evidence. The separate analyses and presentation of the relevant data will provide the more detailed supporting material you should refer to in your executive summary style final paper. There is no specific recommended format for these appendices and no limit to the number of pages that comprise the appendices so use your good judgement in how best to clearly communicate this detailed information to a busy executive. This means that you will need to make smart use of all the Microsoft tools, including Excel to make your own graphs and charts. Also make good use of bullet points, short paragraphs, and links to additional sources. Be creative and trust yourself!
Scenario: You work as an analyst for a very successful venture capitalist. Recently, your boss has divested a number of businesses and she is eager to reinvest the capital that has been freed up from these divestments. She has instructed you to identify an industry that has significant growth potential and the prospect for long-term profitability. You know from working with her over the last 3 years that she likes to invest in those industries that are straightforward and generally easy to understand how they create value for the consumer and for society as a whole. Therefore she likes to invest in industries that create tangible products or services, she doesn’t like financial services.
After selecting an industry, you will then need to make recommendations to her regarding the best way to enter that industry, either through acquisition or through a startup venture. You must weigh the pros and cons of each approach and recommend the one approach you think is best based on the evidence of your research and knowledge of strategic management.
You also need to know that your boss demands careful and thorough analysis. With this in mind, a well-argued recommendation requires careful and systematic application of strategic management theory and its analytical frameworks to provide the necessary structure and logic to help you make your case with the data and evidence that you collect during your research. It is imperative that you carefully select the sources of information you rely on.
Sources of Information: For this assignment, you should make good use of IBIS World as well as other relevant and reputable sources you discover. You will need to reference and cite these sources in a reference section at the end of your document where your sources of information are cited in APA format.
In your analysis, consider the following:
1) Dominant Economic Characteristics of the Industry
a) Market size and growth rate over the past 10 years and projected growth rates
b) Stage in the industry life cycle
c) Number and sizes of competitors
d) Average profitability of the industry over the last 5 years and projected profitability
e) Do these economic characteristics indicate growth potential and long term profitability? Why?
2) Identify the driving forces of change that are impacting the industry and company
a) Analysis of general environment:
i) What are the dominant influential forces of change in the industry?
ii) Do they present a significant opportunity or threat to the industry?
iii) On balance, do these forces provide a significant opportunity for growth and profitability?
b) Analysis of competitive environment:
i) Assess the level of competition in the industry (5 forces analysis)
(1) Level of rivalry of incumbent firms
(2) Threat of substitutes (assess the barriers to entry)
(3) Threat of substitutes
(4) Relative level of buyer power and supplier power.
ii) How do these forces of competition impact the level of profitability of the industry?
iii) On balance, do they represent opportunities that can be profitably pursued, or are they threats that are difficult to overcome?
3) Identify the critical success factors of this industry (Critical success factors are those areas and aspects of the business that firms must be good at to be profitable and succeed):
a) Based on these critical success factors, which activities in the value chain seem most critical? Why?
b) What does this suggest about the core competencies of successful firms in this industry?
i) How difficult or costly is it to acquire or build these competencies?
ii) Are these competencies easy to copy?
4) Identify the business-level strategies of the successful firms in this industry (Low cost and/or differentiation?)
a) How well positioned are the top firms in this industry? Which strategies do they employ? How are they performing relative to the industry average?
b) Is there “space” in the industry to establish a strong competitive position whilst avoiding direct competition from the incumbent firms? It might be good to do a quick strategic group analysis.
c) How difficult would it be to establish a distinct and effective competitive position?
d) Given the critical success factors and the competitive strategies of incumbent firms, what type of strategy would it likely be? (Low cost, differentiation or focus strategy?)
5) Executive Summary of Analysis and Recommendations:
Your analysis should be written in a format that is appropriate for a busy executive (not in “term paper” form). I would like you to write the document in the format of an extended “executive summary” which should be no more than 3 single-spaced pages. It needs to be a professional and persuasive well-argued recommendation that relies on thorough systematic application of the strategic management theory and analytical frameworks and supported with carefully selected and presented evidence. The separate analyses and presentation of the relevant data will provide the more detailed supporting material you should refer to in your executive summary style final paper. There is no specific recommended format for these appendices and no limit to the number of pages that comprise the appendices so use your good judgement in how best to clearly communicate this detailed information to a busy executive. This means that you will need to make smart use of all the Microsoft tools, including Excel to make your own graphs and charts. Also make good use of bullet points, short paragraphs, and links to additional sources. Be creative and trust yourself!