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2-1 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann.

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Presentation on theme: "2-1 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann."— Presentation transcript:

1 2-1 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Managerial Problem Solving Frameworks, Tools, Techniques Robert Wood Julie Cogin Jens Beckmann

2 2-2 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Chapter 2 Problem Identification

3 2-3 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann SWOT Analysis Definition A tool to identify the Strengths, Weaknesses, Opportunities and Threats associated with the organisational context for a particular problem Strengths and weaknesses are internal value-creating (or -destroying) factors (e.g. skills and resources) that can be measured using internal assessments or external benchmarking Opportunities and threats are external value-creating (or -destroying) factors a company cannot control, but which emerge from the environment

4 2-4 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann SWOT Analysis When to Use Problem identification (exploration of organisational context) Solution generation (identification of alternative problem solutions) Solution evaluation (appraisal and prioritisation of solutions) To define an organisations strategy To developplans for work or personal life Individuals career planning

5 2-5 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann SWOT Analysis Simple Rules Be realistic Be specific Distinguish between where your organisation is today, and where it could be in the future Always analyse strengths and weaknesses in the context of your competition Keep it short and simple Keep in mind: A SWOT is subjective

6 2-6 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann SWOT Analysis Guiding Questions Strengths Every organisation has strengths What are your advantages? What do you do well? What can you offer that your competition cannot? Dont be modest, be realistic

7 2-7 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann SWOT Analysis Guiding Questions Weaknesses Every organisation has weaknesses What could be improved? What is done poorly? What should be avoided? Do you have any current problems? This should be considered from an internal and an external basis Do others perceive weaknesses that you dont see? Do your competitors do any better?

8 2-8 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann SWOT Analysis Guiding Questions Opportunities All organisations have some opportunities that they can gain from What chances are available? What are the interesting trends? Useful opportunities can come from: Changes in technology and markets on both a broad and a narrow scale Changes in government policy related to your field Changes in social patterns

9 2-9 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann SWOT Analysis Guiding Questions Threats No organisation is immune What obstacles do you face? What is your competition doing? Are the required specifications for your job, products or services changing? Is changing technology threatening your position?

10 2-10 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann SWOT Analysis Questions What to Look For Potential Resource Strengths Powerful strategy Strong financial condition Strong brand name, image, reputation Widely recognized market leader Proprietary technology Cost advantages Staff motivations, skills Shared values, commitment of staff Good customer service Better product quality Alliances Potential Resource Weaknesses No clear strategic direction Outdated practices, facilities Weak balance sheet, excessive debt Higher overall costs than rivals Missing some key skills, competencies Low morale, weak commitment of staff Internal operating problems. Falling behind in R&D Too narrow product line Weak marketing skills Potential Resource Opportunities Serving additional customer groups Expanding to new geographic areas Expanding product line Transferring skills to new products Vertical integration Openings to take MS from rivals Alliances Expansion of products, services Openings to exploit new technologies Openings to extend brand name, image Potential Resource Threats Entry of potent new competitors Loss of sales to substitutes Slowing market growth Adverse shifts regulatory rules, etc Costly new regulations Vulnerability to business cycle Growing leverage of customers or suppliers Shift in buyer needs for product Demographic change

11 2-11 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann SWOT Analysis Limitations Provides a description of the organisations position Raises awareness Can encourage to explore widely Can help to inform debates Does not identify problems Does not provide answers

12 2-12 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann PEST Analysis Definition A tool to identify the Political, Economic, Social and Technological factors of a particular problem The emphasis is on the importance of the environment when generating solutions to problems Organisations environment Internal: staff, internal customers, office technology, wages, etc. Micro: external customers, agents, distributors, suppliers, competitors Macro: political, economic, socio-cultural, technological forces

13 2-13 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann PEST Analysis When to Use To assist solving more complex problems for large businesses Revision of a strategy, marketing proposition, etc. Problem identification (the position, potential and direction for a business) Solution generation (triggers proactive thinking about consequences of proposed problem solutions)

14 2-14 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann PEST Analysis Simple Rules Be realistic Be specific Distinguish between where your organisation is today, and where it could be in the future Always analyse strengths and weaknesses in the context of your competition Keep it short and simple Keep in mind: A PEST is subjective

15 2-15 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann PEST Analysis Guiding Questions Political Influence upon the regulation of businesses How stable is the political environment? Will government policy influence laws that regulate or tax your business? What is the governments position on marketing ethics? What is the governments position on the economy? Does the government have a view on culture and religion? Is the government involved?

16 2-16 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann PEST Analysis Guiding Questions Economic Consider short- and long-term state of trading economy Interest rates? Inflation? Employment level per capita? Long-term prospects for the economy Gross Domestic Product (GDP) per capita?

17 2-17 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann PEST Analysis Guiding Questions Socio-cultural Varies from country to country What is the dominant religion? What are attitudes to foreign products and services? Does language impact upon the diffusion of products onto markets? How much time do consumers have for leisure? What are the roles of men and women within society? How long is the population living? Are the older generations wealthy? What are the differences between age groups? Does the population have a strong/weak opinion on green issues?

18 2-18 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann PEST Analysis Guiding Questions Technology Major driver of globalisation Does technology allow for products and services to be made more cheaply and to a better standard of quality? Do the technologies offer consumers and businesses more innovative products and services? How is distribution changed by new technologies? Does technology offer companies a new way to communicate with consumers?

19 2-19 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann PEST Analysis Example

20 2-20 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann 5Ws and Root Cause Analysis Definition The 5Ws provide a questioning structure for clarifying some element of a problem through repeated questioning (what, when, who, where, and why?) Root cause analysis is an extension of the 5Ws (repeatedly asking why, in order to get to the root cause of a problem)

21 2-21 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann 5Ws and Root Cause Analysis When to Use Problem identification To be used to clarify and redefine problems To provide cues for determining the goals To find out what additional data and analyses is needed Solution generation Can be used in combination with a fishbone diagram To explore all potential or actual causes for a problem Most useful when problems involve human factors or interactions

22 2-22 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann 5Ws and Root Cause Analysis Simple Rules All problems can be defined in terms of five simple attributes: 1. the What? 2. the When? 3. the Who? 4. the Where? 5. the Why? Not all attributes are relevant for all problems The What?-attribute is always relevant and should be addressed first The Why?-attribute should be addressed last Avoid thinking about solutions before all the attributes are known

23 2-23 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann 5Ws and Root Cause Analysis Guiding Questions What: What is the problem here? What do we need to know? What would the ideal situation look like? What criteria will we use to measure our success at solving this problem? Where: This refers to the physical or structural locations of problems Where does the problem usually arise? Where might we expect problems to arise? When: Timing issues include: When does the problem occur? When do we have to be done? When will the solution be used?

24 2-24 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann 5Ws and Root Cause Analysis Guiding Questions Who: This refers to who is affected by a problem or who is the source of a problem Who is involved in the problem? Who will determine whether or not we have succeeded? Why: This is used for determining either values/goals or, more commonly, the cause of a problem Why do we need to solve this problem? Why is that happening? Why do people react in that way?

25 2-25 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann 5Ws and Root Cause Analysis Limitations This tool relies on inferences, hence assumptions / conclusions can be incorrect use of data (hard evidence)

26 2-26 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann 5Ws Analysis Example

27 2-27 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Value Chain Analysis Definition Tool for analysing the activities in which a firm can pursue a competitive advantage strategy (e.g. low cost versus differentiation) Can help to make the implementation of competitive strategies more systematic

28 2-28 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Value Chain Analysis Two Categories of Activities Primary activities are those involved in the creation, sale and transfer of products or service (including after-sales) Inbound logistics – concerned with receiving, storing, distributing inputs Operations – comprise the transformation of the inputs into the final product form Outbound logistics – involve the collecting, storing, and distributing the product to the buyers Marketing and sales – how buyers can be convinced to purchase the product Service – involves how to maintain the value of the product after it is purchased

29 2-29 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Value Chain Analysis Two Categories of Activities Support activities are not directly involved in production, but should increase a firms effectiveness or efficiency Procurementconcerned with the tasks of purchasing inputs such as raw materials, equipment, and labour Technology developmentthese activities are intended to improve the product and the processes and can occur in many parts of the firm Human resource managementrecruiting, hiring, training, development, performance, management and compensation Firm infrastructurethe activities that are not specific to any primary area; including general management, planning, finance, and accounting

30 2-30 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Value Chain Analysis When to Use Problem identification (identification of obstacles to implementing a competitive strategy) In combination with a SWOT analysis of the value chain, it can facilitate effective outsourcing decisions Evaluation of strategic alliance choices

31 2-31 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Value Chain Analysis Simple Rules In a company with more than one product area, it is appropriate to conduct the value chain analysis at the product group level, and not at the corporate strategy level Be sure to include the subcontracted or outsourced portions of work as activities Do not just look at each activity independently; the value chain is a system of activities that are interdependent because they are related by their linkages If you have strong relationships with one or more of your customers, it may be worth presenting your conclusions to them and getting their feedback

32 2-32 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Value Chain Analysis Three Simple Steps Step 1: Activity analysis Identify the activities you take to deliver your product or service to the customer Start with primary activities, continue with support activities Step 2: Value analysis Add to all activities listed customer value factors Add to needs to be improved in order to further differentiate you from competitors Step 3: Planning and implementation Evaluate ideas for increasing value to your customers with regard to costs and benefits Be aware of linkages between activities

33 2-33 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Value Chain Analysis Framework

34 2-34 Copyright 2009 McGraw-Hill Australia Pty Ltd PPTs t/a Managerial Problem Solving by Wood Slides prepared by Robert Wood, Julie Cogin and Jens Beckmann Value Chain Analysis Limitations Time consuming Typically used for industrial organisations that buy material and transform these into physical products Hence, adaptations are needed to apply this tool to service-based industries


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