“The essence of strategy is choice”
Effective strategies allow organizations to differentiate and gain lasting competitive advantage. Strategic decisions enable organizations to differentiate themselves, add value to the products and services, and compete effectively in the market. Having a clearly defined mission and vision statements, and the strategies to achieve them help companies focus their limited resources where it matters and achieve high performance. In that respect, strategies provide a sense of direction and purpose for leaders and employees by mobilizing all the elements of the value chain. Through its strategy services, ARGE helps organizations define and implement value creating strategies that drive profitable growth.
The Company, as the pioneer of many new products in the sector, was proud of the quality of its products. The Company was continuously increasing its product portfolio to achieve sustainable growth. However, the Company had started to make losses when the economic recession had led to market stagnation and new rivals began to focus on particular segments of the market, challenging the Company to explore new ways of doing business to improve its performance. It was then the Company began to make a strategic evaluation with ARGE.
Strategic evaluation was started by comparing Company’s value chain with market expectations and competitors’ products.
1. The value chain of the Company, from production cost to arrival at the end users, was evaluated and the productivity at each level was compared with benchmarks.
2. The Company structure was tested in terms of suitability to various segments of the customers.
3. Demand propensities were measured; and goods and services that did not create sufficient value for the customers were determined.
4. Product portfolio was evaluated; unprofitable products were identified.
5. The productivity of customer portfolio was analyzed.
6. General expenses were analyzed and unproductive areas and resources were identified.
1. A 50% savings over general expenses incurred by the Company.
2. The Company moved from a 10% turnover loss to +15% profitability.
3. Market value of Company rose by 75% more than the stock exchange index.