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CONFIDENTIALBU Strategic Plan BasicsJim Ayala – PHOMelissa Gil – PHORegina Manzano – PHOSuresh Mustapha – PHOSteve Shaw – HKOShelly Yeh – PHOChoon-Gin Tan – SIOTraining materials8 June 2001This report is solely for the use of client personnel. No part of it may be circulated, quoted, or reproduced for distribution outside the client organization without prior written approval from McKinsey Company. This material was used by McKinsey Company during an oral presentation; it is not a complete record of the discussion.DESCRIPTION OF MATERIALSThis document was developed as a training presentation for the newly appointed Business Unit CEOs of an Asian Family-owned conglomerate.The purpose of this document is to guide new CEOs through the basic elements of developing a BU-level strategic plan.This presentation is complemented by a companion document the “BU Strategic Plan Template Book” which provides completeness and consistency of BU strategic plan submissions. These templates are not intended to replace or constrain BU strategic thinking and should be adapted to reflect a particular BU’s sectoral context as requiredWHAT IS A BU STRATEGY?A strong business concept that drives an integrated set of actions that creates value by:Creating products/services whose value exceeds the cost of providing themCapturing value from competitors, customers, distributors, suppliers, and producers of substitute products and services5. Considers tradeoffs between benefit provided to customers and costs they incur3. Gives consideration to all elements of the business system2. Forces choices4. Recognizes importance of cost as competitive tool1. Recognize dual role of creating and capturing value in all elements of business system6. Competitive7. Externally oriented, customer drivenRATIONALE FOR PROPOSED DEFINITIONA strong business concept that drives an integrated set of actions that creates value by:Creating products/services whose value exceeds the cost of providing themCapturing value
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