7. Porter’s Single Diamond Framework BLUE DIAMOND Gov’t Chance Rugman and Hodgetts, International Business 2003
8. Strategic Fit The Competitive Advantage Matrix BLUE DIAMOND Strong weak weak Firm-specific advantages strong Country-specific advantages Souces: Adapted from Rugman and Hodgetts, International Business 2003 1 2 3 4 ARGOS Cost Leadership Strategy – strong in CSAs but week in FSAs Differentiation (uniqueness) – Any Strategy Focus Strategy Focus Differentiation – Strong FSAs in marketing/customization
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11. Market Penetration Product Development Carlton ’ s Strategy Market Development Argos ’ Strategy Diversification Product or Services: Increasing technical innovation Present New Market: Increasing new buyers & customers Present New Market Product Selection Argos ’ Strategic Direction [Source: Adapted from Exhibit 7.1: Strategy Development Directions (pg 341) Johnson, G, Scholes, K & Whittington, R (2007) Exploring Corporate Strategy. FT Prentice Hall]
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13. RESEARCH - DEMOGRAPHICS BLUE DIAMOND 1,392,047 total £ 1,111,644,053 average £ 852.49 average $1,605.44 population (from page 4 of 4 chapter 4, 2005 figures) in BJ $2,200 Phase 1 Shanghai 13,363,000 assumed for all cities Bei Jing 11,616,000 $2,000.00 Tianjin 9,208,000 factor 1.25 Qingdao 7,202,000 Total Phase 1 41,389,000 Phase 2 populations from wikipedia Shanghai 13,363,000 1 Bei Jing 11,616,000 1 Tianjin 9,208,000 2 Qingdao 7,202,000 2 Harbin 9,563,000 3 Shijiazhuang 9,135,000 3 Shenyang 7,200,000 3 Nanjing 6,240,000 3 3000000 Kaifeng 4,800,000 ? £ 3,700.00 Suozou 6,073,000 3 Hangzou 6,400,000 3 £ 11,100,000,000 Fuzhou 6,600,000 3 Guangzhou 7,607,200 skip Chengdu 11,000,000 skip Chongqing 4,196,000 skip 5.3E+11 total retail turnover of china Wuhan 9,700,000 ? Total Phase 2 129,903,200 0.1% £ 530,000,000 UK average disposable income per household £ 12,800.00 UK average household size 2.3 average disposable income per person £ 5,565.22 5% 67% of above £ 3,710.15
26. ARGOS PERFORMANCE IN UK PLUS IRELAND Argos turnover £ 5,548,000,000 population served 65,000,000 UK plus Ireland turnover per head £ 85.35 profit £ 376,000,000 profit 6.8% average disposable income per person £ 5,560 share average person spned of their disposable income 1.5% number of shops 556 number of shop per head of population 116,906 turnover per shop £ 9,978,417
27. Argos in China Phase 1 980,000 people £ 3,700.00 disposable income each £ 3,626,000,000 of available disposable income 1.5% percentage of disposable income the average UK citizen spends in argos
28. Argos in China Phase 2 3,000,000 people £ 3,700.00 disposable income each £ 11,100,000,000 of available disposable income 1.5% percentage of disposable income the average UK citizen spends in argos Phase 2 (without phase 1) 2,020,000 people £ 3,700.00 disposable income each £ 7,474,000,000 of available disposable income 1.5% percentage of disposable income the average UK citizen spends in argos 6.8% incorporate rising profit into years start with 0%
36. BLUE DIAMOND STAKEHOLDER MANAGEMENT AND SOCIAL CAPITAL REPUTATION SHAREHOLDER VALUE SOCIAL INNOVATION, PERFOMANCE STABILITY ECO-EFFICIENCY – FAIR GLOBALIZATION RISK MANAGEMENT REGULATION AND COMPETITIVE POLICIES SOCIAL ACCOUNTABILITY ETHICS INVESTOR DEMAND SRI PHILANTHROPY CORPORATE CITIZENSHIP VOLUNTARY REGULATION COMPANY LAW AND COMPULSORY REGULATION SUSTAINABLE DEVELOPMENT THE 4CR CORPORATE RESPONSIBILITIES MAP
39. BLUE DIAMOND Argos - The Balanced Scorecard Customer Perspective Goals Measures Value Value for money products Increased customer segments Choice Wide range of new and proprietary products Quality Products defects and return Responsive supply On-time delivery
40. BLUE DIAMOND Argos - The Balanced Scorecard Innovation and Learning Perspective Goals Measures Technology capability Operating system to support performance management, organisational learning and knowledge management HRM Human capital readiness to support business growth and strategy
41. BLUE DIAMOND Argos - The Balanced Scorecard Internal Business Perspective Goals Measures Technology Capability Operations management for Marketing, logistic and Just in time management and sales Total Quality Management Customer satisfaction Meeting response time targets Operating efficiency Products availability, forecasts and selection Profitable margins
42. BLUE DIAMOND Argos - The Balanced Scorecard Financial Perspective Goals Measures Healthy Cash Flow Suceed Yearly sales growth and operating income Prosper Year on year increased market share and return on equity
