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Global strategy and leadership
Reading GoGear case carefully
Chris Thomas MBA
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Process of analysing a case
You build your analysis from the ground up
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Process of analysing a case
You build your analysis from the ground up
Rather than taking blocks out, you are trying to fill the gaps with blocks of insight from the case
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GSL subject map
External analysis
Industry
PESTEL
5 Forces
Competitor drivers
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GSL subject map
Internal analysis
Stakeholders
Strategic drivers
Operational drivers
People and Org drivers
Strategic capabilities
External analysis
Industry
PESTEL
5 Forces
Competitor drivers
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GSL subject map
Internal analysis
Stakeholders
Strategic drivers
Operational drivers
People and Org drivers
Strategic capabilities
Product and market
development
Ansoff’s matrix
Product development
Developing markets
Modes of market entry
External analysis
Industry
PESTEL
5 Forces
Competitor drivers
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GSL subject map
Internal analysis
Stakeholders
Strategic drivers
Operational drivers
People and Org drivers
Strategic capabilities
Strategic options
Operational levers
Organisation levers
Evaluating options
Risk
Rumelt’s evaluation
Product and market
development
Ansoff’s matrix
Product development
Developing markets
Modes of market entry
External analysis
Industry
PESTEL
5 Forces
Competitor drivers
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GSL subject map
Internal analysis
Stakeholders
Strategic drivers
Operational drivers
People and Org drivers
Strategic capabilities
Strategic options
Operational levers
Organisation levers
Evaluating options
Risk
Rumelt’s evaluation
Implementation
7-S
Program management
Change management
Monitoring
Leadership and transformation
Product and market
development
Ansoff’s matrix
Product development
Developing markets
Modes of market entry
External analysis
Industry
PESTEL
5 Forces
Competitor drivers
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Reading a case – GoGear
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Always make sure you define the industry!
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Reading a case – GoGear
Industry or Market?
(Module 2)
Where should you focus your
attention?
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Always make sure you define the industry!
Be consistent
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Always make sure you define the industry!
Be consistent
Consider who the organisation is competing against
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Always make sure you define the industry!
Be consistent
Consider who the organisation is competing against
Consider other industry segments
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Reading a case – GoGear
Industry or Market?
(Module 2)
Where should you focus your
attention?
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Reading a case – GoGear
Industry or Market?
(Module 2)
Where should you focus your
attention?
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Reading a case – GoGear
Industry or Market?
(Module 2)
Where should you focus your
attention?
What is the Industry life-cycle?
(Module 2)
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Reading a case – GoGear
What is the Industry life-cycle?
(Module 2)
Compression apparel is growing
FAST!
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Reading a case – GoGear
What is the generic strategy?
(Module 3)
Cost leadership?Differentiation?
Differentiation-focus?
Low Cost Differentiation
Broad focus Narrow focus
Cost focus Differentiation focus
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Reading a case – GoGear
What is the generic strategy?
(Module 3)
Cost leadership?Differentiation?
Differentiation-focus?
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Reading a case – GoGear
What is the generic strategy?
(Module 3)
Cost leadership?Differentiation?
Differentiation-focus?
Compression is only 10.9% of 38% of the market…4.1%
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early 2007 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2025-26
Sales Started $400,000 $1.28 $1.90 $2.81 $4.16 $6.16 $9.12 $13.50 $20 $200
Growth 48% 48% 48% 48% 48% 48% 48% 25.90%
Profits (%) 8% 32%
Profits ($) $6.39 ?
GoGear…a new, entrepreneurial business
In Australia the athletic apparel and footwear industry is worth $1.2b
Athletic apparel sales are 38% of the athletic apparel and footwear industry ($456m)
Compression wear market is 10.9% of athletic apparel sales ($49.7m)
GoGear has close to 40% market share in Australian market compression wear ($19.88m)
$1.2 billion x 38% x 10.9% x 40% = $19.88
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Can it grow sales by 10 times in 10 years?
To get from $20 million to $200 million you need to grow at 25.9% p.a.
$20 million x (1.259)10
Is this possible?
early 2007 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2025-26
Sales Started $400,000 $1.28 $1.90 $2.81 $4.16 $6.16 $9.12 $13.50 $20 $200
Growth 48% 48% 48% 48% 48% 48% 48% 25.90%
Profits (%) 8% 32%
Profits ($) $6.39 ?
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Can it grow sales by 10 times in 10 years?
To get from $20 million to $200 million you need to grow at 25.9% p.a.
$20 million x (1.259)10
Is this possible?
early 2007 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2025-26
Sales Started $400,000 $1.28 $1.90 $2.81 $4.16 $6.16 $9.12 $13.50 $20 $200
Growth 48% 48% 48% 48% 48% 48% 48% 25.90%
Profits (%) 8% 32%
Profits ($) $0.33 $6.39 ?
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Can it grow sales by 10 times in 10 years?
To get from $20 million to $200 million you need to grow at 25.9% p.a.
$20 million x (1.259)10
Is this possible?
early 2007 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2025-26
Sales Started $400,000 $1.28 $1.90 $2.81 $4.16 $6.16 $9.12 $13.50 $20 $200
Growth 48% 48% 48% 48% 48% 48% 48% 25.90%
Profits (%) 8% 32%
Profits ($) $0.33 $6.39 ?
If they keep market share…it is…but….
2014-15 2015-16 2016-17 2017-18 2018-19 2019-20
Revenues $29.58 $49.70 $77.04 $119.40 $185.08 $286.87
Growth 68% 55% 55% 55% 55% 55%
GoGear Share (40%) $19.88 $30.81 $47.76 $74.03 $114.75
Compression Industry - Australia early 2007 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2025-26
Sales Started $400,000 $1.28 $1.90 $2.81 $4.16 $6.16 $9.12 $13.50 $20 $200
Growth 48% 48% 48% 48% 48% 48% 48% 25.90%
Profits (%) 8% 32%
Profits ($) $0.33 $6.39 ?
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Can it grow sales by 10 times in 10 years?
Will the maintain those profits?
What might new entrants or other competitors do to capture market share?
How will they maintain supply if their current manufacturer is at capacity
How will they manage this growth….200 people for $20m….how many for $200m
This growth is just in Australia…but they want an overseas expansion as well…
If they keep market share…it is…but….
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Can it grow sales by 10 times in 10 years?
Will the maintain those profits?
What might new entrants or other competitors do to capture market share?
How will they maintain supply if their current manufacturer is at capacity
How will they manage this growth….200 people for $20m….how many for $200m
This growth is just in Australia…but they want an overseas expansion as well…
You need to work through the template and fill in the gaps…
Every paragraph has interesting information
If you can’t find PESTEL or 5-Forces in detail…don’t panic…it might not be there
If they keep market share…it is…but….
There is a lot of analysis to perform…
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