Low risk investments 10 Medium risk investments 15 New ventures other high risk

Low risk investments 10 medium risk investments 15

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Low risk investments: 10% Medium risk investments: 15% New ventures other high risk: 25% Replace Itech in year 8 for $25,999 Hester machines last for 10 years No impact for inflation, work in constant dollars Cost of calibration and consumables increase with revenue increases. No increases to cost of annual service contract
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Strategic, Operational, and Budgetary Planning
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Strategy: Creates a unique sustainable advantage. Common Elements of Strategy Long-term and consistent goals. Deep understanding of the competitive environment. Objective assessment of resources and capabilities. Effective execution to reach the goals. Strategy Aim: Creating Value (Profitability and growth) Sam Walton (Walmart): offered lower prices. Steve Jobs (Apple): “put a ding in the universe.” Mark Zuckerberg (Facebook): made the world connected. Larry Page & Sergey Brin (Google): made information accessible. Key Questions: Where to compete? How to compete?
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Competitive Advantage Attributes: o Value: Fits customer needs better than alternatives (Demand) o Rare (Scarcity) o Not easily imitated or copied (Inimitability) o Not easily substituted (Substitutability) o Value depreciates slowly (Durability) o Company can “appropriate” the Value Sources: Internal : o Tangible Assets : Plants/Operations. Financial resources. Technology. Innovation. Product portfolio. o Intangible Assets : Brands. Reputation. Intellectual Property. Expertise. Know-How. Process. Culture. Creativity. Agility. Marketing. External : Customer demand and preferences. Input costs. Technology disruptions. Resource availability.
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Strategic Planning & Management Integrates strategic, operational, financial plans and objectives Reflects situational analyses: Process is iterative! Aligns plans, resources, incentives Portfolio management: Common competencies but different application/market Use appropriate expectations and goals Make tough decisions. Force tough decisions regarding “ugly” businesses. “Plan to Plan”: Process of planning is informed by management’s vision Planning process can rejuvenate or update the company Planning requires: Identifying those who will be involved and their role Defining the stages and roles at each stage Accepting that the process is iterative and is a process of learning.
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Strategic Planning and Management 1. Develop Vision & Mission 2. Analyze Environment: PESTEL, 5 Forces, 5C, SWOT, etc… Assess core competencies. 3. Determine strategic issues, portfolio, opportunities, capabilities, and plans. Invest or …? 4. Develop strategies (corporate, business, functions) -> priorities, objectives, goals, metrics, investments... 5 . Manage: Implement/execute, monitor, assess, adjust, & align.
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5–12 Strategic and Operational Levels Exhibit 5–3 Strategic Planning : Long-term vision, mission, objectives, plans, and goals.
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