Diagnostic method and apparatus for business growth strategy

• US 20020173998A1
• Filed: 01/11/2001
• Published: 11/21/2002
• Est. Priority Date: 01/11/2001
• Status: Active Grant

• Current Assignee: Case Strategy LLP
• Original Assignee: Case Strategy LLP
• Inventors: Case, Amy
• Granted Patent: US 6,859,785 B2
• Time in Patent Office: Days
• US Class Current: 705/7
• CPC Class Codes: G06Q 10/04 Forecasting or optimisation specially adapted for administrative or management purposes, e.g. linear programming or "cutting stock problem" market predictions or forecasting for commercial activities G06Q30/0202
• CPC Class Codes: G06Q 10/06 Resources, workflows, human or project management; Enterprise or organisation planning; Enterprise or organisation modelling
• CPC Class Codes: G06Q 10/0637 Strategic management or analysis, e.g. setting a goal or target of an organisation; Planning actions based on goals; Analysis or evaluation of effectiveness of goals
• CPC Class Codes: G06Q 10/06375 Prediction of business process outcome or impact based on a proposed change
• CPC Class Codes: G06Q 10/06393 Score-carding, benchmarking or key performance indicator [KPI] analysis
• CPC Class Codes: G06Q 30/0204 Market segmentation
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

A method and apparatus for quantitatively determining the optimal mix of strategies to drive growth (i.e., in company profits). The growth strategy mix includes a reenergize component, an adjacency component and a transformation component. Company data of companies exhibiting successful growth is obtained. From the obtained company data, a model that quantifies respective amounts of reenergizing activities, adjacency activities and transformation activities for different strategic growth mixes is defined. The model is applied to a given company such that respective quantitative amounts of a reenergize component, an adjacency component and a transformation component are defined and form a strategic growth mix for the given company. The invention may be computer implemented to provide an interactive questionnaire for quantitatively determining a growth strategy mix. A non-electronic questionnaire implementation provides a calculation tool of the present invention as well.

Claims

1. A method for quantitatively determining a strategic growth mix, the growth mix including a reenergize component, an adjacency component and a transformation component, the method comprising the steps of:

obtaining company data of companies exhibiting successful growth;

from the obtained company data, defining a model that quantifies respective amounts of reenergizing activities, adjacency activities and transformation activities for different strategic growth mixes; and

applying the model to a given company such that respective quantitative amounts of a reenergize component, an adjacency component and a transformation component are defined and form a strategic growth mix for the given company.

2. A method as claimed in claim 1 wherein the step of defining a model includes, for each of the companies exhibiting successful growth:

from the obtained company data, calculating respective quantitative values for determining factors indicative of business activities and market position of the companies;

for each determining factor, (i) providing a respective changeably predetermined range of factor values and a changeably predefined weight for each of the reenergize component, adjacency component and transformation component, and (ii) as a function of the calculated quantitative value for the determining factor and the predetermined ranges, selecting one of the reenergize component, adjacency component and transformation component for associating with that factor;

for each component, summing the respective weights of the component corresponding to each selection of the component across the different determining factors, such that a respective weighted sum is produced for each of the reenergize component, adjacency component and the transformation component; and

based on the weighted sums, determining relative percentage of the reenergize component, the adjacency component and the transformation component, the set of the determined relative percentages forming a model growth plan, such that plural different model growth plans are formed and define the model.

3. A method as claimed in claim 2 wherein the determining factors include any combination of:

market share to revenue ratio, asset to revenue ratio, change in profitability, responsiveness to market volatility, debt to equity ratio, credit worthiness, cash flow to revenue ratio, relative market share, change in market share, relative elasticity of demand, business mix, business age, number of divisions, number of SIC industries, R&

D investment, acquisition strategy, strategic intent, asset growth, customer loyalty, qualitative measures of shifting value, and the identification of certain industries as having a bias toward a particular growth strategy.

4. A method as claimed in claim 1 further comprising the steps of:

collecting or estimating data regarding manpower, time and dollars spent by companies that have successfully implemented growth plans in the past;

applying the data to the formed strategic growth plan for the given company to provide general guidelines regarding manpower, time period and dollar investment to implement the strategic growth mix formed for the given company.

5. A calculation tool formed by the method of claim 1.

14. A method as claimed in claim 1 wherein the steps are computer implemented.

6. Apparatus for quantitatively determining a strategic growth mix, the growth mix including a reenergize component, an adjacency component and a transformation component, the apparatus comprising:

a source of company data of multiple companies exhibiting successful growth;

a model defined from the company data, the model quantifying respective percentages of reenergizing activities, adjacency activities and transformation activities for different strategic growth mixes; and

means for applying the model to a given company such that respective quantitative amounts of a reenergize component, an adjacency component and a transformation component are defined and form a strategic growth mix for the given company.

7. Apparatus as claimed in claim 6 wherein the model is defined by the steps of:

from the source of company data, calculating respective quantitative values for determining factors indicative of business activities and market position of a company;

for each determining factor, (i) providing a respective changeably predetermined range of factor values and a changeably predefined weight for each of the reenergize component, adjacency component and transformation component, and (ii) as a function of the calculated quantitative value for the determining factor and the predetermined ranges, selecting one of the reenergize component, adjacency component and transformation component for associating with that factor;

for each component, summing the respective weights of the component corresponding to each selection of the component across the different determining factors, such that a respective weighted sum is produced for each of the reenergize component, adjacency component and the transformation component;

based on the weighted sums, determining relative percentage of the reenergize component, the adjacency component and the transformation component, the set of the determined relative percentages forming a model growth plan; and

repeating the foregoing steps for each of the multiple companies, such that plural different model growth plans are formed and included in the model.

8. Apparatus as claimed in claim 7 wherein the determining factors include any combination of:

market share to revenue ratio, asset to revenue ratio, change in profitability, responsiveness to market volatility, debt to equity ratio, credit worthiness, cash flow to revenue ratio, relative market share, change in market share, relative elasticity of demand, business mix, business age, number of divisions, number of SIC industries, R&

D investment, acquisition strategy and strategic intent.

9. Apparatus as claimed in claim 8 wherein credit worthiness is based on economic measurements, including a factor evaluating the absolute age of the company.

10. Apparatus as claimed in claim 6 wherein the means for applying further from collected or estimated company data on a set of companies that have previously implemented successful growth plans, provides general guidelines for manpower, time period and dollar investment to implement the growth plan formed for the given company.

11. Apparatus as claimed in claim 6 wherein the means for applying is a questionnaire.

12. Apparatus as claimed in claim 6 wherein the model is formed of a set of electronic spreadsheets.

13. Apparatus as claimed in claim 12 wherein the means for applying is an interactive questionnaire.