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Class 4 MA BSBA 2011 Cisco

Class 4 MA BSBA 2011 Cisco - BUSI599 Mergers Acquisitions...

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BUSI599 – Mergers & Acquisitions BSBA – Spring 2011 1 Prof. David Ravenscraft Kenan-Flagler Business School University of North Carolina Session 4: Cisco
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2 M&A Strategy Proces s New Competencies needed for vision What Bidder brings to the table? Company Analysis Bidder Core Competencies Bidder Future Vision Industry Analysis Industry Analysis Industry Fit/Synergy Strategic Fit and Option Value Pos ition/ Synergy Potential Cost Savings Revenue Enhancement Environmental Analysis Stock Market Reaction Related Merger Environment Industry Analysis External As s es s ment Turning Strategy into Action Deal Pipeline Target Company Identification Entry Option Evaluation Clear Vision of deal process & integration Acquis ition Target(s ) CEMEX, GE, CISCO
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3 Setting Acquisition Strategy What Does Bidder Bring to the Table? Transferring Core Competency Resource/Core Competencies Based Theory Assets: people, technology, locations, products Competencies: knowledge, skills, processes Capabilities: ability to transform, improve or change firm performance and competencies over time Resources/Core Competencies satisfy several criteria Valuable -- provide real benefits to customers/stakeholders Inimitable -- be hard for competitors to imitate Rare – better than competitors Organizationally relevant -- apply across firms business units Available -- resources must not be utilized to capacity
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4 Cisco Core Competencies (a) culture that accepts new ideas (b) customer driven (measurement & bonus) (c ) leadership 50% with customer, lets employees achieve personal goals, identifies leaders & empowers them (d) Reputation & PBA (Pioneering Brand Adv.) (not fired for using Cisco) (e) new product development, clear process (5 clear stages in NPI process), all cross-functional (engineering, marketing, mnf.), speed to market (f) outsourcing decision (outsourcing mnf competitive advantage), they focus on intellectual part logistics, qualifying suppliers, new process development (g) strong distribution channels, powerful sales organization and value added resellers (VARs) (h) Process systems like MRP (material resource planning) and Autotest
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