ETM525/625:StrategicPlanninginEngineeringManagement
Fall2014
ProfessorRonKhormaeiPh.D.
CONTACT INFORMATION Instructor: Prof. Ron Khormaei Telephone: 503.725.5465 E‐mail: khormaei@pdx.edu Class Website: bb.pdx.edu Office Hours: After class or by arrangement (NOTE: This information is for an early reference. The active syllabus is distributed at the first session.) CourseOverview&LearningObjectives
COURSE DESCRIPTION ETM 525/625: STRATEGIC PLANNING IN ENGINEERING MANAGEMENT is a four‐credit (40‐hour), Graduate‐
level course structured around 10 lectures, 15 historical case studies, and a class project. This course provides practical tools and approaches, rooted in research, to develop strategic plans. The course is aimed at managing direction and planning from a corporate, department, or a small company orientation in today’s fast paced “hyper‐velocity” markets. One of the key questions to be addressed is “How can I develop a strategy when it is nearly impossible to identify a long‐term competitive advantage?” The challenge is to be able to manage today in order to position the company to compete in an essentially unknowable future. Course activities include selected readings from “Competing on the Edge: Strategy as Structured Chaos” by Brown and Eisenhardt, supplemented by case‐study monographs. There is also a team class project that is designed to enable the participants to develop a corporate strategic plan that uses the concepts learned in the course and apply them to a real case. The course is designed to emphasize planning for implementation while minimizing risk, in a fluid environment. Defining one’s strategy is necessary, but often insufficient to assure success. The challenge is planning for effective implementation and agile adaptation in the face of fast‐changing technologies and markets. COURSE OBJECTIVES After completing the readings, lectures and assignments the student will be able to: ETM 525/625 Strategic Planning in Engineering Management Page 1 | 16 • Organize the overall flow for a new or updated strategic plan • Be able to use one of the five approaches to building strategies • Explore internal and external cultural characteristic that affect competition in a rapidly changing environment • Recognize the proper level of planning, and identify tools that allow visibility into the “fuzzy future” • Understand the concepts of continual reinvention and patching to take maximum advantage of market opportunities. • Be able to apply the right approach and set of questions based on the size, timing horizon, and goals of the organization. COPYRIGHT All pages in this document are under Copyright © 2013 by The Maseeh College of Engineering and Computer Science, Portland State University REQUIRED TEXTBOOK Competing on the Edge – Strategy as Structured Chaos by Shona L. Brown & Kathleen M Eisenhardt, Harvard Business School Press, Boston MA 1998, ISBN 0‐87584‐754‐4 REQUIRED READINGS 1. Racing for Growth: An Interview with PerkinElmer’s Greg Summe, Heimbouch, H., Harvard Business Review, HBR R00607, Pub. 11/1/00, 7p. 2. Cray Research, Inc., Aguilar, Francis J.; Brainard, Caroline E., Harvard Business School Pubs. 9‐385‐
011, 6/30/86, 22p. 3. Note on the Boston Consulting Group Concept of Competitive Analysis and Corporate Strategy, Allan, G.B., Harvard Bus. School Pubs. 9‐175‐175 (Revised 4/1/83) 8p. 4. Revitalizing Dell, Jan W. Rivkin Harvard Bus. School Pub. Case study 710442 (Pub 2/14/2010), 27p. 5. “The Power of Virtual Integration: An Interview with Dell Computer’s Michael Dell,”; Dell, M.; Magretta, J.; Harvard Bus. Rev. 98208, Pub. 3/1/98, 13p. 6. Amgen, Inc.: Planning the Unplannable, Nohria, N.; Berkley, J. D.; Harvard Bus. School Pub 9‐492‐052 (Pub. 9/25/98) 18p. 7. Scientific Management at Merck: An Interview with CFO Judy Lewant, Lewent, J.; Nichols, N. A. Harvard Business Review 94106, Jan‐Feb 1994, 3p. 8. Living on Internet Time: Product Management at Netscape®, Yahoo!, Netdynamics and Microsoft., Iansiti, M., Harvard Bus. School Pubs. 9‐697‐052 (revised 6/30/99), 21p. 9. 3M Optical Systems: Managing Corporate Entrepreneurship, Bartlett, Christopher A.; Mohammed, Afroze, Harvard Bus. School Pub 9‐395‐017 (Revised 5/28/99), 19p. 10. INTEL Corporation 1968‐1997, Collis, D. J.; Pisano G. P.; Botticelli P., Harvard Bus. School Pub 9‐797‐
137, (Rev 10/21/98) 23p. 11. INTEL Corporation 2005,Yoffie, David B., Harvard Bus. School Pub 9‐706‐437, October 12, 2005 8p 12. How to Use Strategy Maps to Achieve Long Range Objectives, Gouillart, F. J., Harvard Bus School Pub B0009B, (Pub 9/15/00) 3p. 13. Using the Balanced Scorecard as a Strategic Management System,. Kaplan, R. S;. Norton D. P., Harvard Business Review; Jul/Aug2007, Vol. 85 Issue 7/8, p150‐161, 11p, 7c R0707M ETM 525/625 Strategic Planning in Engineering Management Page 2 | 16 14. The Importance of Being Strategic, Porter, M.E; Balanced Scorecard Report, Harvard Bus. School Pub B0203D March‐April 2002, 5p. 15. Strategic Intent, Gary Hamel & C,K, Prahalad, Harvard. Bus. Review, Jul/Aug2005, Vol. 83 Issue 7/8, p148‐161, 13p 16. Apple Computer 2006, Yoffie, David. B.; Slind, Michael; Harvard Bus School Pub, 9‐ 706‐496, Rev. May 30, 2007 32p. The text Competing on the Edge as well as the Harvard Business case studies may be purchased through the PSU Bookstore, or on‐line through Harvard Business School Publications. The text may also be purchased through Amazon.com at http:www.amazon.com , or you may find a copy at Powells. The Harvard Business Review Articles (Items 1,5,7, and 13) may be downloaded for free through the PSU library. The case study Publications (Items 2,3,4,6,8,9,10,11,12, and 14) from the Harvard Business School Publications may be purchased on‐line at HBR site provided separately(Please note you will save approximately 50% of the cost of buying individual Harvard Case studies by clicking on this link and purchasing the entire pack; https://cb.hbsp.harvard.edu/cbmp/access/30779540) OPTIONAL SUPPLEMENTAL READINGS 1. The Strategy Process: Concepts, Contexts and Cases by Mintzberg & J.B. Quinn, Prentice Hall, Upper Saddle River, NJ (4th Edition) ISBN 0‐13‐234030‐5 2. Are you a Strategist or Just a Manager?, Harvard Bus. Review, HBR 92104, Pub. 1/1/92, 5p. 3. BioGen Unchained, Bovet, D.; Martha J. ; Harvard Bus. Rev. F00305, (Pub 5/1/00) 1p. 4. Allen‐Bradley: Electronic Manufacturing Strategy, Harvard Bus. School Pub.; Balaguer, N. S.; Preuninger, J. W.; Harvard Bus. School Pub: 9‐191‐018 (Published 3/29/93) 19p. 5. Samsung Electronics, Harvard Bus. School Pub.; Siegel, J.I., Chang, J.J.; 9‐705‐508, Rev 8/2/05, 26p. 6. Blue Ocean Strategy, Kim and Mauborgne, Havard Bus Sch. Press, 2005 ASSIGNMENTS Submissions Your completed assignments are due at the beginning of each classroom session. Specific submission instructions will be included in all assignment instructions. Late Policy You are expected to turn in assignments on time. If you think you will be unable to complete an assignment on time, please email the professor in advance. Otherwise you will receive a grade of “0” for that assignment. Note that late assignments could get only a percentage of the grade. Plagiarism You should note that using information without attributing it to its source constitutes plagiarism. In this course, you will do research and use a variety of media to complete assignments. If material is quoted ETM 525/625 Strategic Planning in Engineering Management Page 3 | 16 directly from any source, the source must be cited in your deliverable. (Check with the professor if you are unsure of the citation formatting or placement.) The source of non‐quoted information or statistics used in support of any point must also be cited, including information from websites and other online sources. Any submission that is not properly documented will receive a grade of “0.” Preparation You will be expected to prepare for class by reading the assigned materials and completing project and group work as assigned. Although you are expected to be familiar with all the concepts and terminology introduced in the readings, you will not be required to memorize detailed information. You must be able to intelligently discuss the patterns, concepts, strategies, etc. described in each chapter of the text. You must also be familiar with the case studies throughout the book, as well as the 12 historical case studies. Finally you are expected to listen to the lectures each week, understand the concepts that are presented and contribute to the class discussion. Material presented during the lecture parallels the text and the historical studies, but frequently contains additional material not covered in these sources. Written Assignments There are weekly reading assignments from both the text and selected case studies. The written assignment is to be turned in by the next session. EVALUATION The course evaluation will be determined as follows: •
•
•
•
25% Case Individual Written Assignments (3 per term) 25% Case team Presentation (1 per term) 40% Team Project 10% Individual Class Participation This course is not about number of pages, hours in class, or number of e‐mails. It is about ideas, concepts, and communication; the grade will reflect your ability to understand ideas and communicate them to the rest of the class and to the professor. COURSE SCHEDULE Class will be held from 5:30 pm to 9:10 pm on Tuesdays in 1900 SW 4th Ave room 40‐08 Fourth Avenue Building (FAB) on the PSU Main Campus. Please check the ETM website for any last minute changes. ABOUT THE PROFESSOR Dr. Ron Khormaei is the President of ADN Management Solutions, LLC which provides Business and Operations consulting to growing technology companies. He is also an Associate Professor at Portland State University with courses and research in Technology Management and New Product Development areas. His consulting and classes specifically cover technology strategy, roadmaps, and new product generation. Dr. Khormaei was the General Manager at Lensbaby, the only US manufacturer of lenses for SLR cameras, until mid‐2012. He started his career at ETM 525/625 Strategic Planning in Engineering Management Page 4 | 16 Planar Systems in Beaverton, Oregon, leading development of advanced displays. After Planar, he held various management roles for 13 years in Hewlett‐Packard and led technology developments resulting in numerous consumer and commercial products. His last role at HP was Director of Engineering at company’s OEM Printer Division where he managed a global engineering team of over 100 and multiple external design partners. After HP, Dr. Khormaei became the Director of Engineering at Logitech’s Audio Business. He earned a Ph.D. in Electrical Engineering from Oregon State University in 1995. He has led multidisciplinary development programs, involving global teams, in consumer electronics systems and imaging development areas. He has served on multiple Advisory Boards and taught graduate‐level courses at universities including Oregon State, UC‐Riverside, and Portland State University. He has been awarded 2012 OSU Academy of Distinguished Engineers recognition, published over 30 papers, and has 7 US patents. Dr. Khormaei has established and led multiple successful external consortiums as well as global university and industry partnerships. CLASS OUTLINES AND LIST OF ASSIGNMENTS Assignment No. 1 (optional pre‐class) ‐ to be completed along with Unit 1 (note: additional assignments due Tuesday are below next to each class unit): Answer the following in a 3‐5‐page essay BEFORE reading any of the course material. (This will not be graded and is meant to prepare you for the first class discussions.) 1. At this point, what does the word “strategy” mean to you? (20 pts) 2. What are great strategies, (in business, war – or anything else) that you have read about and why are they great? (30 pts) 3. What situations exist in your organization (company division, or country) that could benefit from improved strategy or strategic thinking? (20 pts) 4. Who are the people in your organization that you think of as being primarily involved in strategy and planning? (10pts) 5. Do you think your primary responsibilities have any strategic impact in your organizations? If so, should they? (20 pts) 6. What do you personally hope to take away from this course? How will it benefit you and your organization? ETM 525/625 Strategic Planning in Engineering Management Page 5 | 16 Unit 1– Tue., 9/30 –Setting the Stage‐‐Where are you coming from – where are you going? Assignments to be completed & turned in Learning Objectives: None required. After completing this unit, you will be able to: •Gain a definition of Strategy. Assigned Reading: ‐ Preconceived concepts of strategy 1. Competing on the Edge: Preface, Chapter 1, ‐ Understanding the thrust of the text approach ‐ Defining strategy as “Winning” Optional Reading: • Understand the difference between 1. Bringing science to the art of strategy. Lafley, A. G., Martin, R. L., Rivkin, J. W., & Siggelkow, N. strategy and tactics (January 01, 2012). Harvard Business Review, 90, 9, ‐ Vision 56‐66. ‐ Philosophy 2. Racing for Growth: An Interview with ‐ Culture – Internal and External PerkinElmer’s Greg Summe; Heimbouch, H., Harvard Bus. Rev., HBR r00607, Pub. 11/1/00, • Consider some alternate Approaches to 7p. defining Strategy – ‐ Five Forces‐ Discussion of Five Answer the Following questions based on the Forces Strategy Perspective ‐ Core Competence – Discussion in reading assignments: Unit 2 1. What distinguishes the approach to strategy ‐ Portfolio Analysis – Discussion in taken in the text from more “traditional” Unit 3 approaches? Be sure to discuss the specifics of ‐ Game Theory – Discussion in Unit 4 what market characteristics each approach assumes. (20 pts) • Discover how to Affect Strategy at Multiple 2. What is a semi‐coherent strategy? (Hint: You might start with a definition of a coherent Levels strategy) (20 pts) ‐ Culture versus Strategy 3. What was Greg Summe’s strategic vision for ‐ Strategic operational change for EG&G (Be specific. i.e. quantifiable metrics)? competitive advantage (20 pts) _ 4. What were the some inherent internal and ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ external cultural issues at EG&G that he had to overcome? Note how attempts to implement changes in strategy can be frustrated when your internal culture is not in harmony with your strategic intent. (10 pts) 5. How did Greg put “teeth” in his tactics to change EG&G? What actions did he take to really engage the employees in his plan? ETM 525/625 Strategic Planning in Engineering Management Page 6 | 16 Unit 2 – 10/7 ‐ Approaches to Strategy‐ Contrasting approaches and their relevance Learning Objectives: Assignments to be completed before After completing this unit, you will be able to: • Configure an organization for agility and Assigned Reading: innovation 1. Competing on the Edge Chapter 2: Playing the • Understanding the concept of “operating Improvisational Edge on the edge”: between bureaucracy and 2. Cray Research, Inc. Harvard Bus. Sch. Pubs. chaos 385‐011 • Understand the concept of Core Answer the Following questions based on the Competence reading assignments: o Organizational capabilities 1. What are the dangers (not the characteristics) o Technology of an overly structured or under structured o Experience or history organization? (30 pts) 2. What happened to the technology and • Learn the difficulties of sustaining a single marketplace that eventually consumed Cray’s competitive advantage: competitive advantage? How did the markets • Niche market penetration by change? (Pay particular attention to “the voice technological prowess of the customer”.) (50 pts) • Maturing markets and 3. How did Cray’s culture (external and internal) customer expectations get out of step with the changing market? (20 • What does it take to survive beyond pts) the initial success? Invited Speaker: David Wetchler, HP Senior Strategist ETM 525/625 Strategic Planning in Engineering Management Page 7 | 16 Unit 3 – Tue., 10/14 ‐ Market Positioning‐ Portfolio Analysis
Learning Objectives: Assignments to be completed before After completing this unit, you will be able to: Consider how to Position the business • Start‐Up • Small to Mid Size single business • Multi‐product/multi‐business • Interaction and synergies Understand Portfolio Analysis • Cash Flow Potential • Relative Market Share • Market Growth Potential • Investment Strategy • Defense – Identify and fill significant gaps • Offense – Identify and prioritize future opportunities • Cash Flow to drive Growth Manage to Maximize Synergy • Levels of decision on collaboration • Value of the choices • Stars and Lockstep Traps Assigned Reading: 1. Competing on the Edge Chapter 3: Capturing Cross‐Business Synergies 2. Note on the Boston Consulting Group Concept of Competitive Analysis and Corporate Strategy Harvard Bus. Sch. Pubs. 9‐175‐175 (Rev. Apr. 1, 1983) Answer the Following questions based on the reading assignments: 1. What are the dangers (not the characteristics!) of the “lockstep” & the “star” traps? (20 pts) 2. The text warns against not having a “star” in a corporation’s portfolio, but is there a time you might actually want a “star”? What would the potential benefits be? Why would the other businesses be willing to make sacrifices to support the “star”? (20 pts) 3. What is the underlying criterion for the portfolio style of analysis? What are the strategic objectives of the tool? (20 pts) 4. What is a corporate strategy versus a “holding company” strategy? (You may have to research the definition and strategy for a holding company) (10 pts) 5. Refer back to the PerkinElmer paper. Was Boston Consulting Group’s? What Greg Summe’s analysis consistent with the elements in his “vision” specifically correspond to the BSC’s analysis? (20 pts) 6. Is any of Portfolio Analysis approach relevant in today’s “hypervelocity” markets? Indicate the drawbacks and how you can overcome them and still use the technique. (10 pts) ETM 525/625 Strategic Planning in Engineering Management Page 8 | 16 Unit 4 – Tue., 10/21 ‐ Regeneration—Creating the New From the Past
Learning Objectives: Assignment to be completed before After completing this unit, you will be able to: • Understand another alternate strategy Assigned Reading: approach: 1. Competing on the Edge Chapter 4: Gaining the o Game Theory Advantages of the Past 2. Revitalizing Dell, Jan W. Rivkin Harvard Bus. • Profit from a Company’s historical School Pub. Case study 710442 (Pub 2/14/2010) development starting from the past 27p. Case study HKU069, (Pub 1/1/00), 28p. 3. The Power of Virtual Integration: An collection of successes and failures Interview with Dell Computer’s Michael Dell Harvard Bus. Rev. 98208 Pub • Explore Several Different Ways to operationally Implement strategic Answer the Following questions based on the marketing paths: reading assignments: • Going Direct o Coca Cola 1. How did Dell originally regenerate the approach t o Dell the computer business? Recall "regeneration" is taking something that already exists and adapting
• Plan for Make or Buy Decisions – to new conditions. (This question is being asked Strategies of Vertical Integration versus from the point of view of the PC industry.) (20 pts
Virtual Integration 2. What aspects of the past did Dell use to leverage their approach in Marketing, production and • Maximizing Value Added: criteria for service? Did they start from a clean slate? (This what or when question is from the point of view of Dell as a company) (20 pts) • Internal production versus 3. What were the strategic reasons for things starte t
outsourcing go bad? (20 pts) 4. Contrast Dell’s strategy with IBM & Compaq in • Internal Investment Strategy terms of vertical and horizontal integration. Is one more appropriate for a start up? Why? (20 • Prioritizing Investments pts) 5. What, according to Michael Dell, are the advantages of having fewer physical assets? (10 pts) 6. In your opinion, is Dell’s outsourcing of customer service merely putting the company’s problems o
somebody else’s shoulders? Why? (10 pts) Michael Dell Invited Speaker‐ Don Konia; CEO, FEI ETM 525/625 Strategic Planning in Engineering Management Page 9 | 16 Unit 5 ‐‐ Tue., 10/28 ‐ Planning in the face of extreme uncertainty
Learning Objectives: Assignments to be completed before After completing this unit, you will be able to: Assigned Reading: • Consider ways to involve the future in 1. Competing on the Edge Chapter 5: Winning today Tomorrow Today 2. Amgen Inc. Planning the Unplannable; Harvard • Plan in the absence of “hard” predictive Bus. Sch. Pubs. 9‐596‐058 (Rev. Sept. data 25, 1998) 3. Scientific Management at Merck: An • Use low‐impact inexpensive experiments Interview with CFO Judy Lewant, Lewent, J.; o “probing” Nichols, N. A. Harvard Business Review 94106, Jan‐Feb 1994, 3p. • Pursue Strategic Alliances as a “Window into the Future” Answer the Following questions based on the reading assignments: • Incentivise for the future 1. How did Amgen win or lose at managing future planning? Management versus scientists ? (20 o —the 15% rule pts) 2. How can the extended development and approval time change market potential for a • Foster Creativity and Agility‐ Managing the new product? How did Amgen actually plan High Tech Professional. prioritize & manage their plethora of research projects? (20 pts) 3. How can Monte Carlo modeling be useful in analyzing and planning in the absence of “hard” data (data that is based on existing facts)? (10 pts) 4. Contrast how Merck used this tool to plan and prioritize their research projects. What effect did the utilization of this tool have on management‐scientist relations? (20 pts) 5. Define in your own words a “probe” & when and how often should you probe? (What determines the optimal frequency of probing?) Is there a danger in “escalating” (increasing the level of investment in a new product) beyond probing too soon? (30 pts) ETM 525/625 Strategic Planning in Engineering Management Page 10 | 16 Unit 6 – Tue., 11/4 ‐ Hitting your Stride ‐ Setting the Pace
Learning Objectives: Assignments to be completed before Tuesday After completing this unit, you will be able to: Assigned Reading: • Optimize planning effectiveness 1. Competing on the Edge Chapter 6: Setting the Pace where possible by using time‐
2. 3M Optical Systems: Managing Corporate paced rhythm Entrepreneurship, Bartlett, Christopher A.; Mohammed, Afroze, Harvard Bus. School Pub 9‐
• Managing Transitions 395‐017 (Revised 5/28/99), 19p. 3. Visit the 3M website and read about the history of o Setting the internal pace ‐ Event versus Time Driven “Post‐ it Notes” http://www.3m.com/us/office/postit/pastpresent/history.
Html • Utilize Mentoring and Political Advocacy Optional Reading: The secrets to successful strategy execution. Neilson, G. L., • Effectively Implement of Strategy Martin, K. L., & Powers, E. (January 01, 2008). Harvard Business Review, 86, 6, 60‐70. Answer the Following questions based on the reading assignments: 1. Contrast the Gillette and Amgen approaches to portfolio management in the context of time‐ versus event‐pacing? (20 pts) 2. As the Business Unit Manager, Andy Wong, how would you respond to the request for an additional
$750K? What are the options and implications (for Andy?, His Group? The Product?) for each choice of the decision? (30 pts) 3. What is the difference between the Intel strategy of building for a future as yet undefined (They commit ~$2B to build a fabrication facility 2 years ahead of when it is needed often not knowing what the exact chip to be built is.), and the Andy Wong (3M Business Unit Manager) “amassing ammunition” strategy for a future as yet undefined? (30 pts) 4. Check the 3M Web site to see what they actually did with the privacy screen? http://www.3m.com What was Andy’s actual decision? (20 pts) Invited Speaker‐ Paul Menig ETM 525/625 Strategic Planning in Engineering Management Page 11 | 16 Unit 7 – Tue., 11/11 ‐ Moving into the Future—Growing Versus Assembling
Assignments to be completed before Learning Objectives: After completing this unit, you will be able to: Assigned Reading: Inventory the current state of the company 1. Competing on the Edge Chapter 7: Growing the • Past History Strategy • Culture and Structure 2. The Importance of Being Strategic, Porter, • Personnel – The Long and short of it M.E; Balanced Scorecard Report, Harvard Bus. • Previous Markets and Customers School Pub B0203D March‐April 2002, 5p. 3. Strategic Intent, Gary Hamel & C,K, Prahalad, Understand The Company Today Harvard. Bus. Review, Jul/Aug2005, Vol. 83 Issue • Definition – Philosophy and Vision 7/8, p148‐161, 13p • Personnel ‐ Core Competence • Markets and Customers Answer the Following questions based on the • Operational Tactics reading assignments: 1. Discuss Growing versus Assembling in terms of Decision Making utilizing the past, present and future. How are the two approaches different? (20 pts) • Analyze the current market position 2. How do you identify potential “missing links” in and then move to strengthen it. future transitions? (Make sure you consider the case where the transition has a basis in the Product Portfolio Analysis past, as well as a potentially disruptive • Defense – Identify and fill significant emerging technology). (10 pts) gaps 3. Contrast and compare Michael Porter’s opening • Offense – Identify and prioritize future remarks (“The starting point of creating opportunities good…”) as well as his comments as to what • Cash Flow to drive Growth strategy isn’t, in The Importance of Being Strategic with the things you have learned in Extend the planning time horizon the course. Next Review Strategic Intent and • Probing note the authors strong statements about why • R&D Western businesses have lost the strategic • Strategic Alliances ‐ battle with the Asian competitors. What are o Customers the key mistakes by so‐called “expert o Suppliers strategists” in Western companies? 30 pts) o Universities 4. Michael Porter has a definite idea as to where Re‐examine the true meaning and every company wants to go. What is that goal implementation of Strategy. is it relevant to fast changing technology • The balanced scorecard. driven businesses, and do you agree with him? • Strategy vs operational excellence. Is it relevant to the Capstone (game)? (20 pts) 5. A common sequence for markets (such as DRAM) is, when they emerge they are performance/technology driven. Following that, the market matures, more competitors enter and the market becomes a commodity (efficiency) driven market. Porter’s comments on “operational effectiveness” vs strategy are particularly stinging here. Consider your answer in terms of how most US companies strategize about competing in price sensitive markets vs. how they should. (20 pts) ETM 525/625 Strategic Planning in Engineering Management Page 12 | 16 Unit 8‐ Tue., 11/18 ‐ How to keep score—The Balanced Scorecard Assignments to be completed before Learning Objectives: After completing this unit, you will be able to: Assigned Reading: • Understand how to establish some metrics 1. Competing on the Edge Chapter 8: for your strategic plan 2. Using the Balanced Scorecard as a Strategic Management System,. Kaplan, R. S; • Make sure that your plan involves actionable Norton D. P., Harvard Bus. School Pubs elements for all segments of the company 96107, (Pub. 1/1/96) 11p. 3. How to Use Strategy Maps to Achieve • See where you can measure “where you Long Range Objectives, Gouillart, F. J., want to go” versus “Where you actually Harvard Bus School Pub B0009B, (Pub are”. 9/15/00) 3p. Answer the Following questions based on the reading assignments: 1. Write a brief summary of the lessons you personally learned from the Capstone Game. Were there any “hidden” lessons (not part of what you expected or that were indicated in the manual) that you discovered? (10 pts) 2. How does modularity fit into patching? (What is patching and why do businesses or products have to be modular?) What characteristics must an individual business or product have in order to be patched? (Be sure to first define Patching!) (20 pts) 3. How does the size of a “patch” affect the evolution of the organization? (10 pts) 4. What is the key strategic issue underlying the use of the “balanced scorecard” (BSC) and why is it so important? Look back at Michael Porter’s comments on the BSC in terms of a process and discuss how each of his cited “things” fit together in his vision of the BSC “hierarchical scheme.” (20 pts) 5. Consider the evolution of a company from startup to mature multi‐product corporation. Do you think that the BSC should be applied as is stated “balanced” in terms of the 4 perspectives… or does the balance actually shift with time? (20 pts) 6. If the tool is as wonderful as the two articles advocate, why isn’t this in more widespread use? What other potential major drivers of a company’s strategy aren’t addressed and are there dangers in strictly pursuing the “balanced scorecard?” (20 pts) ETM 525/625 Strategic Planning in Engineering Management Page 13 | 16 Unit 9 ‐ Tue., 11/25 ‐ A Modern‐Day Study of Planning in the Face of Paranoia‐‐ INTEL Learning Objectives: After completing this unit, you will be able to: • Understand the natural evolution of technology driven markets • Be familiar with performance driven markets and commodity markets • Understand one high‐tech company’s strategy for succeed in changing markets • Be familiar with Moore’s Law • Become aware of trends in the PC industry Assignments to be completed before Assigned Reading: 1. INTEL Corporation 1968‐1997, Collis, D. J.; Pisano G. P.; Botticelli P., Harvard Bus. School Pub 9‐797‐137, (Rev 10/21/98) 23p 2. INTEL Corporation 2005,Yoffie, David B., Harvard Bus. School Pub 9‐706‐437, October 12, 2005 8p 3. You may want to refer back to Chapter 6 in Competing on the Edge 4. *** Suggested Optional Reading*** (And Extra Credit) Read
the Optional Case Study about Samsung‐‐ Samsung Electronics, for an update on what happened to the DRAM Market after INTEL exited. Extra Credit Question is below. • Samsung Electronics, Harvard Bus. School Pub.; Siegel, J.I., Chang, J.J.; 9‐705‐508, Rev 8/2/05, 26p. Answer the Following questions based on the reading assignments 1. What is Moore’s Law? Is it a real “physical” phenomenon? What are its limitations? (10 pts) 2. Discuss the need for pace using the Intel exhibit 10 graph showing unit sales (index) versus year. (What does INTEL have to plan for in order to create a “relentless flow of competitive advantages?) (10 pts) 3. In Intel how did the DRAM product evolve out of sync with corporate strategy? (Discuss in particular, the kinds of markets from a financial and competitive advantage perspective). (20 pts) 4. How did INTEL manage out of the DRAM market crisis? Who actually made the strategic decisions to exit? (20 pts) 5. In light of Game Theory describe the initial IBM strategy to grow the market and then the subsequent moves versus Compaq to attempt to corner the PC market? How did they each decide to play the game? (20 pts) 5. In Intel 2005, discuss why Samsung is considered as such a serious threat to INTEL. What competences and potential competitive advantages does Samsung possess that INTEL may not? (10 pts) 6. Consider INTEL’s newly reorganized business groups. If you were to guess, which one do you think will become the next “killer application” or strategic win for INTEL. Explain why. Do you think the PC processor business by itself will continue to be INTEL’s worldwide flagship? (10 ***Optional Extra Credit*** (An “A” on this question will add +3 credits to your assignment grade or one full grade mark.) Answer the very last line in the Samsung case study on p11. Do the question and your answer have any relevance to a company’s competitiveness in China? If you are working for, or have worked in the past for, a company that competes in ETM 525/625 Strategic Planning in Engineering Management Page 14 | 16 Unit 10 ‐ Tue., 12/2 ‐ Planning at Internet Speed
Learning Objectives: After completing this unit, you will be able to: • Follow a Company’s commitment to the future—product renewal • Manage the Present to be positioned to take advantage of today and tomorrow • Develop Products in Fast Changing “Hyper‐ velocity” markets • Understand “Gate Processes” versus Internet‐time driven development processes • Linear versus simultaneous versus overlap Assignments to be completed before Tuesday 3/19/2012 Assigned Reading: 1. Living on Internet Time: Product Management at Netscape®, Yahoo!, Netdynamics and Microsoft., Iansiti, M., Harvard Bus. School Pubs. 9‐697‐052 (revised 6/30/99), 21p. 2. Apple Computer 2006, Yoffie, David. B.; Slind, Michael; Harvard Bus School Pub, 9‐706‐ 496, Rev. May 30, 2007 32p. Answer the Following questions based on the reading assignments 1. Explain the term “Internet Time” in terms of introducing information pertaining to a new product (hardware or software). (20 pts) 2. Contrast how an Internet company identifies, and corrects mistakes during product development versus a more traditional “gate‐ process” company? Pay particular attention to the flow of the two processes. (20 pts) 3. If the method used by Internet companies is so wonderful… can you use it in any industry? Why or why not? (10 pts) 4. Apple users “Fell in love with the Mac”. Explain how this type of customer response shaped Apple’s strategy in the market. What was Apple’s competitive advantage? What was the resulting financial performance? (10 pts) 5. Discuss how Scully tried to move the Macintosh into the mainstream. Before you do that, explain why the product was not mainstream and what it really was. (10 pts) 6. Contrast Steve Job’s approach to sales channels with Michael Dell’s. Considering the strategic objective of mainstream market domination, which approach was right for Apple? In particular discuss the typical customer for each company’s products. (10 pts) 7. Frequent competitive advantages in today’s markets are “complementary assets”— operational elements that enable the market success of a particular product or service. Discuss how the introduction of “iTunes” as a specialized complementary asset tremendously increased the iPod’s market performance. (10 pts) 8. Write a short summary of what you will personally take away from the class… what you liked… and what might be done differently. (10 pts) ETM 525/625 Strategic Planning in Engineering Management Page 15 | 16 ETM525/625Fall2013–ClassSchedule
Date Week Lectures Class Project Section Project Comments/Assignments Sept. 30 1
Unit 1 – Setting the Stage Teams are formed, target companies to emulate selected, and roles within teams assigned. There will 3‐5 members per team. The team will select from the companies assigned for this course or a public company of choice. The class project will leverage the course materials and class teachings. Submit your team members, company, and general plans to the instructor by end of class. Oct. 7 Oct. 14 2
3
Unit 2 – Approaches to Strategy Unit 3 – Market Positioning Section 1: Company vision and mission (and include objectives, targets, outcomes, what constitutes success, etc.). Finalize target organization and framework. Section 2: Strategy philosophy including methodologies and culture Ten minute update presentation per team. Ten minute update presentation per team (including Q&A). Oct. 21 4
Unit 4 ‐ Regeneration Section 3: Positioning and portfolio analysis Ten minute update presentation per team. Oct. 28 5
Unit 5 ‐ Planning in the Face of Extreme Uncertainty Section 4: Opportunity and risk assessment ; New offerings A good introduction/stimulator could be the old Apple video – “Knowledge Navigator” made in 1987! – http://www.youtube.com/watch?v=
HGYFEI6uLy0 or the more recent (circa 2009) “World in 2030” http://www.youtube.com/wa
tch?v=219YybX66MY. Nov. 4 6
Unit 6 – Hitting your Stride Section 5: Analysis; Alternatives 30 minute update presentations. Speaker: Nov. 11 7
Unit 7 – Moving into the Future Section 6: Commercialization; Sustaining the business 30 minute update presentations (Continued) Nov. 18 8
Unit 8 – How to Keep Score Section 7: Metrics; Balanced Scorecard Nov. 25 9
Unit 9 ‐ A Modern‐Day Study of Planning in the Face of Paranoia ‐ INTEL Epilogue: Exit strategy, succession planning, etc. Ten minute update presentation per team. Dec. 3 10
Unit 10 ‐ Planning at Internet Speed Team presentations and submission of project reports. The report should be a professional strategic plan that can be presented to top management. Include an executive summary and table of contents in the report. Dec. 9 11
Team presentations and submission of project reports. ETM 525/625 Strategic Planning in Engineering Management Page 16 | 16