1. 1 2008-09-05Kent Thorén and Matti Kaulio Group Assignment 2

2. 2 2008-09-05Kent Thorén and Matti Kaulio Group Assignments F2F 1 F2F 2 F2F 3 F2F 4 F2F 5 Introduction Business Environment Adding Value Service production & Launch Making it Happened & Exams Group assign- ments: Threat From Substitutes Beta Learning (a) Beta Learning (b) Case-based Examination Inventory of competencíes 4-action framework

3. 3 2008-09-05Kent Thorén and Matti Kaulio 1.Get a TeliaSonera business area as a case to analyze. 2.Do a overview and detailed analysis of Threats From Substitutes (instructions follow). 3.Write a 4-5 page report (+ cover page), handed in latest 4 th of December Assignment 2

4. 4 2008-09-05Kent Thorén and Matti Kaulio Case Distribution Group: 1 2 3 4 5 6 Case: Fixed network Mobility services Broadband services Fixed network Mobility services Broadband services

5. 5 2008-09-05Kent Thorén and Matti Kaulio Assignment Work Flow

6. 6 2008-09-05Kent Thorén and Matti Kaulio Brainstorming Substitutes & Alternatives Develop a “Gross list”: Be creative and open-minded, do not judge the suggestions until you finished a preliminary list. Your knowledge about emerging technologies and customer trends may be helpful starting points. Try to focus on substitutes and alternatives, rather than rival products. Anything that can steal sales from us is worth investigating! (see Appendix for inspiration) A final list of 4-8 substitutes is a good objective.

7. 7 2008-09-05Kent Thorén and Matti Kaulio Overview Threat Evaluation Describe each threat more in detail in order to prioritize. Make sure to include your TeliaSonera business area in the analysis for comparison. You will discuss segments later in this module (Ralph Blomqvist). For this exercise, defining a few broad customer groups will suffice. Take particular care to customers segments’ ‘wish list’. Key Success factors (KSF) from preferences that apply in reality is also useful. Be sure to explain your thinking in the final report.

8. 8 2008-09-05Kent Thorén and Matti Kaulio Threat Prioritization Make a judgment on which 1-3 threats to analyze deeper. No model is provided for this decision, so use the overview threat evaluation in combination with other considerations you feel are relevant. Be sure to explain your thinking in the final report.

9. 9 2008-09-05Kent Thorén and Matti Kaulio Detailed Threat Analysis A good idea is to prepare by browsing chapter 2 in Kim & Mauborgne “Blue Ocean Strategy”. Use the tools to evaluate Key-Success-factors (KSFs) for current customers mainly (in the book they also add KSFs for the industry’s non-customers). Be sure to explain your thinking in the final report.

10. 10 2008-09-05Kent Thorén and Matti Kaulio Strategic Alternatives Outline the possible remedies for meeting the threats. Try to make a structure, grouping or model of the alternative strategic moves. Be creative and open-minded, your suggestions does not need to be limited by what TeliaSonera does today or what is possible today. Then discuss briefly whether each alternative is a useful choice for TeliaSonera. For example, you can make some sort of table of pros-and-cons. Be sure to explain your thinking in the final report.

11. 11 2008-09-05Kent Thorén and Matti Kaulio Recommendation Based on the strategic alternatives and the analysis you have done, what are your recommendations for the business area in question? You are also welcome to add other conclusions or reflections you might have. Be sure to explain your thinking in the report.

12. 12 2008-09-05Kent Thorén and Matti Kaulio Final report The final report should present each step of the process and include a recommendation. The length of the reports should be 4-5 pages + cover page

13. 13 2008-09-05Kent Thorén and Matti Kaulio APPENDIX Group Assignment 2

14. 14 2008-09-05Kent Thorén and Matti Kaulio Strategic canvas A method for illustrating the strategic positions in the current market space, created by Kim & Mauborgne. It captures each competing business concept’s offering levels on key success factors. Key Success Factor (KSF) Aspects of business demanding special attention when managing the position on a competitive arena. These are factors industry players currently can choose to compete with. (Often related to customers key purchasing criteria and company performance criteria.) Segmentation Division of the total market in special groups (segments) with separate characteristics, for example geographical, demographical, social and/or behavioral. Opportunity A beneficial juncture of circumstances. In business it refers to a potential for bringing a unmet market need together with a feasible solution. Threats Aspects of the environment that could damage our current of future business. Substitutes Products that has the same purpose or meet the same underlying needs as our products, and provide the same utility but through a different form. Alternatives Products that has the same purpose or meet the same underlying needs as our products, but through a different utility and form. Thesaurus

15. 15 2008-09-05Kent Thorén and Matti Kaulio More 5-forces Details Source: DeWitt & Meyer, 2004.

16. 16 2008-09-05Kent Thorén and Matti Kaulio 5-Forces & Macro Environment Source: DeWitt & Meyer, 2004. Modified

17. 17 2008-09-05Kent Thorén and Matti Kaulio Different Kinds of Substitutes Source: Kim & Mauborgne, 2005 Form (solution) Function/Utility Different Same Different Substitute products Rival products Alternative products N/A For products with the same purpose or underlying need, there are 3 types of competition:

18. 18 2008-09-05Kent Thorén and Matti Kaulio Overview Evaluation of Threat For each key segment, evaluate substitutes vs. key success factors (KSF): Example Automobile industry Segment: Corporate customers Car retailers LeasingRenting C2C used cars Cooperative owning Low upfront price Low owning & using costs Availability & reliability Ease of service & repair Model-changing costs End user appeal

19. 19 2008-09-05Kent Thorén and Matti Kaulio Detail Evaluation of Threat For the 1-3 most important threats, specify KSF positions more closely: Upfront price Owning & using costs Availability & reliability Ease of service & repair Model- changing costs End user appeal Source: Kim & Mauborgne, 2005 Low High Car retailers Cooperative Leasing Example Automobile industry