Observations/analysis of a strama defense on a FMCG multinational business unit

Ateneo Professor on Entrepreneurship

 

I was surprised that I was invited again to sit at a panel of strama defense.  For unknown reasons,  I was never invited for almost a year.  Well, some of male professors have been notorious for being critical and strict with many defenders.  And for right reasons:  we want to ensure:    the quality of the GSB, and we want the student to proudly carry the title "Master"  The school has been branded as diploma mill for GSB.

Today I am back to my element.  While I gave passing grade to the student these are my observations:

1.  He discussed a business unit,  a multinational engaged in FMCG distribution and marketing, which in reality does not have degrees of freedom to implement the strategies. I thought the paper was on a SBU? He did not even mention the legal entity of the local business unit? or the business model.    He mentioned such limitations as:

     1.  Carrot and stick system of reducing AP because of flat, declining sales

     2.  The marching orders are from the regional head/office;

     3.  He blames the corporate stock outs for this problem, and I told that for a year or two that could have been corrected;  something external is amiss?

I thought that only strategic business units are subject of strama.?

2.  The student had audicious goal of achieving x number of billions of sales as his vision/goal for the next several years, yet:

     1. He could not clearly explain why the sales was flat.  He blames corporate woes including lack of correct execution;  but that would not sufficiently explain the flat sales

    2, He portrays the competition to be medium from several quarters and yet the sales does not keep up with growth of the economy and other external factors.  He failed to mention such developments as:    cheap substitutes, other product substitutes for feminine hygiene, and other developments in health care.   His mindset has been strictly pharma:  there are many alternative medicine that it may be eating into the market share. (I informed him that I write on this topic  Cheapcures)  He and his company may not be seeing reality and these changes.

3.  Consistency in the paper:

    1.  Growth opportunities/large markets were presented as beauty care, OTC, and yet were not present in the EFE, and thus in the strategy.   Thus his plan revolves on the products that they have sold before etc., same old story, me too strategy.

    2. For the IFE he prides the company on high engagement of the people, good culture, and yet states that the internal strategic issue has been that of correct execution  which are rather inconsistent.

I hope the professor in charge has the paper corrected and rewritten.

What has that strama paper achieved for the business and economy?  Not much I guess:

1.  Since this is not an sbu, what the regional office has dictated will be followed;

2.  Since the opportunities were not properly addressed, the x billion additional sales will find difficulty in the achievement.  The competitive pressures are not like wise addressed as well as increasing cost of sales channel.

3.  For the internal strategic issues, ie  that there is a need to address cooperation and coordination  (and the student prides in saying that they have strong adherence to corporate culture) and which is not addressed strongly, the problem will persist, execution will be a problem.

4.  Nothing new was presented except incremental improvements (I was hoping I will be surprised amazed).

At the end of the day, we passed a student who knows how to use strategic tool, but who did not create something new, nor made a dent in the universe. 

He did not rock the boat

Am I a panelist or terrorist?