Automotive Industry Study Use of Industry Associations and Analysts in Supplemental Reporting Susan...
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Transcript of Automotive Industry Study Use of Industry Associations and Analysts in Supplemental Reporting Susan...
Automotive Industry Study
Use of Industry Associations and Analysts in Supplemental Reporting
Susan M. Hinds, CEO & President
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
Scope of Analysis- Key Players
JD Powers
The Harbour Report
Analyst
PWC Global Review
Internal Management
Industry Associations
Supplemental Information Sources
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
Key Success Factors Auto Industry
QUALITY
COST
SERVICE
DESIGN
KEY SUCCESS FACTORS
JD Powers, Harbour Assoc, Industry Hawks, Internal Mgmt.
Internal Mgmt, Harbour,Industry Hawks
JD Powers,Internal Mgmt.
JD Powers, RL Polk
WHO MEASURES THIS
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
JD Powers and Associates“The Voice of the Customer”
Proprietary Research
J.D. Power and Associates conducts custom research and customer
satisfaction measurement and tracking on a proprietary basis. Clients gain access to
weekly, monthly, or quarterly data to measure their performance over time and
identify areas for improvement. Proprietary services include: quality
tracking; sales tracking; retailer quality audits; customer satisfaction tracking; and certification programs to ensure
compliance with predetermined industry benchmark standards
INDUSTRIES SERVED- Automotive - Boats - Travel- Finance/Ins - Telecom - Homes- Healthcare
Founded in 1968, global marketing info. services firm focused on helping businesses & consumers make better decisions through credible, meaningful, and easily accessible customer-based information.
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
JD Powers Awards
AUTOMOTIVE FOCUS- New-vehicle quality - The shopping experience- Sales satisfaction - Service satisfaction- Brand loyalty - Online consumer behavior - Emerging technologies - Component quality- Long-term durability - Collision repair
JD Powers surveys millions globally & provides awards:•Information is compiled into rankings on product quality, customer satisfaction, and industry-specific metrics•Highest ranking companies can license the use of name•The award program provides consumers better information in their purchasing decisions
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
The Harbour Annual Report “The Voice of Manufacturing”
James HarbourChairman & Founder
Ron HarbourPresident
Harbour Consulting Inc.- Founded 1980, internationallyrecognized mfg. & mgmt. consulting firm focused onImproving competitiveness of mfg. companies by:•Lean Business Operations•Product & Process Development•Cooperative Benchmarking Studies•Competitive Research
The Harbour Report- A guide to competitive analysis:•Comprehensive analysis of Auto Manufacturing•Data supplied directly by each mfg (KPI & process)•Strengths & Weaknesses by company•Key Performance Indicators & strategic analysis•Major causes of profit variation by manufacturer
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
Voluntary Benchmarking Process-All Major Players Participate
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
Global Automotive Financial Review Annual Report
PricewaterhouseCoopers has published its fourth annual Global Automotive Financial Review providing an overview of automotive industry trends and financial reporting practices. The report is based primarily on information from the annual reports and Form 10ks for fiscal years ending during 2000 and early 2001 for leading manufacturers and automotive suppliers around the world. The Review includes 4 articles summarizing (1) major trends which influenced financial results in the industry; (2) movement toward value reporting; (3) challenges and solutions for sustainability in the industry; and (4) the continued focus on shareholder value. The Review also presents a series of charts and graphs highlighting important ratios and performance metrics used by industry executives and analysts, as well as quotes from industry chairmen on topics such as e-business transformation, economic and market forces, strategies for success, enhancing shareholder value, and predictions.
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
Analyst Community Space DaimlerChrysler AG (DCX) Example
Date Research Firm Action From To
17-May-04 Prudential Downgrade Neutral Underweight
26-Apr-04 Lehman Brothers Upgrade Underweight Equal-weight
4-Jun-03 JP Morgan Downgrade Overweight Neutral
4-Jun-03Smith Barney Citigroup
Downgrade In-line Underperform
19-Mar-03 UBS Warburg Downgrade Neutral Reduce
31-Jan-03Banc of America Sec
Initiated Neutral
18-Jul-02 Bernstein Upgrade Mkt Perform Outperform
12-Jul-02 UBS Warburg Upgrade Reduce Hold
29-Jan-02 Bear Stearns Initiated Neutral
8-Jan-02 Salomon Smth Brny Downgrade Outperform Neutral
RECOMMENDATION TRENDS
Data provided by Thomson/First Call
Current
Month
Last Mont
h
Two Mont
hs Ago
Three
Months
Ago
Strong Buy
3 3 3 3
Buy 0 1 1 0
Hold 2 2 2 6
Sell 2 2 2 1
Strong Sell
1 1 1 1
LacksIndependence
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
Company’s Internal Management“Profitless Prosperity” MindsetKey Industry Concerns: Global Platforms, Hyper-Competition, Incentive Wars,Consolidation, Disruptive Technology (Alt. Fuel), Outsourcing, Productivity
EXISTING INFRASTRUCTURE- VARIES BY COMPANY• 5 year plans linked to annual budget• Annual budget linked to KPI’s linked to incentive systems• Business planning & competitive intelligence• Benchmarking studies• Continuous Improvement goals and measurement systems• Business process reengineering & IT deployment• Cost accounting (process focused)• Lean accounting (used in some OEM’s)• CRM & Market Studies• Risk management systems• Capacity & Utilization forecast/measurements systems
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
EBR Impact & Positioning
JD Powers-Lacks critical issues focus-Market confusion on interpreting measurements-Lacks standards/definitions-Data ownership/entrenched
The Harbour Report-Lacks independent assurance-Enables mfg not investor decisions-Data ownership/entrenched
Analyst-Lacks independence-Confusing analysis -Inconsistent opinionsamong analyst groups-Subjective interpretation& extrapolation
PWC Global Review-Lacks market segment analysis-Macro view mfg-KSF not the focus-Sales focus missing
Internal Management-Need standard benchmarks-Industry paying for excess-Comparability/Segments-Continuous improvement
Industry Associations-Fragmented niche players-Opinion shopping-Lacks integration-Costly duplication
EBRFrameworkIntegrationStandardsGuidelines
MeasurementsXBRL enabled
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC
INDUSTRY ANALYSIS
Target industries with a specific reason (Filter Criteria: In Pain, Proactive Leadership, Public Comments, Commercial Viability, Regulation Target, Large Institutional Investors)
Analyze the infrastructure that exists Understand & identify where gaps exist and where
EBR helps/adds value Sell the target audience from their perspective
Target Analyze Understand Sell
© 2004 STRATEGIC MANAGEMENT HARMONY, LLC