BULIDING YOUR BUSINESS STRATEGY - Amazon S3

BULIDING YOUR BUSINESS STRATEGY A GROWTH MINDSET

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Matt Thomson Managing Partner, CEO - Carey Group

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HORIZON-BASED GROWTHAdapted from “Alchemy of Growth” – Mehrdad Baghai, Stephen Coley, David White

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AG

END

A

Background and Context Why is Strategic Planning Important?1

What is a growth mindset? Adapting your thinking2

The 3 Horizon Model An introduction

3

Building your 3 Horizons Workshop

4

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1. Why have a business strategy?

BACKGROUND & CONTEXT

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• Make the right investment decisions


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• Make the right investment decisions• Guide focus areas


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• Make the right investment decisions• Guide focus areas• Identify the right resources


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• Make the right investment decisions• Guide focus areas• Identify the right resources• Identify the right clients


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2. Why use a Strategic framework?


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• Provide structure to the planning exercise


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• Provide structure to the planning exercise• Increases probability of goal achievement


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• Provide structure to the planning exercise• Increases probability of goal achievement• Methodical way of measuring progress


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• Provide structure to the planning exercise• Increases probability of goal achievement• Methodical way of measuring progress• Leverage the lessons of others


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Growth is one of the most prominent objectives of businesses

Q. Why do businesses “need” to grow?A. Growth provides opportunity

Only 1 out of 10 companies that exceed their industry growth averages in 1 year, are able to sustain it for a decade.

So how does a company balance the competing demands of running a business, and growing a business?

Successful companies get this balance right. To be sustainable, companies can and must out live the individual parts of their businesses.


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SO WHAT DRIVES SUSTAINED SUCCESS?

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SO WHAT DRIVES SUSTAINED SUCCESS?The research indicates:

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SO WHAT DRIVES SUSTAINED SUCCESS?The research indicates:• Relentless focus on efficiencies

of core business activities

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• Evolution and adaptation of core

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• The challenge is to ensure the focus on the present core whilst balancing the need to invent in the future

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• Pipeline of future business/revenue drivers key to sustainability

• Successful companies can and must out-live their individual businesses

• Leaders tend to excel at either core business or pipeline of future business






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• Successful companies can and must out-live their individual businesses

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CAREY GROUP TIMELINE

1950’s

Ingham Based Taxation and Accounting

business

The business moved to the newly

constructed 73-81 Lannercost

Street, Ingham

1990

1998

Established Carey Financial

to offer Financial Planning Services

2002

Opened the Townsville

office to enable access to larger

market

2012

Introduced Strategic SMSF

business to support ongoing

growth in SMSF market

Alliance with existing Cairns

practice

2015

2017

Acquisition of Cairns/Malanda

markets

2019

Multi-office financial advisory

firm across Northern QLD - Accounting

- Financial Advice

- Business Advisory - SMSF

- Auditing - Bookkeeping

2021

Brisbane office opens

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3 HORIZONSHarvard professors teamed with McKinsey, the worlds ‘pre-eminent strategy firm to study some of the most successful companies in history – what makes them successful over the long term.

The research objectives were simple – what makes companies sustainably successfully? And are there common attributes in how those companies are led?

• Companies had to show growth over a sustained period (10-15 years) greater than average sector• Demonstrated growth in return to stakeholders • Companies from Asia, Europe and Australia• Various Sectors• Average annual growth of 23% and ROE growth of 29% over the research timeframes

30 companies identified who’s data was available, including many household names:

Adapted from “Alchemy of Growth” – Mehrdad Baghai, Stephen Coley, David White

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With the data gathered, the researches then identified key attributes of how leaders in those companies developed business strategy.

• The learnings were conceptualised in the 3 HORIZON MODEL.

THE RESEARCH CONCLUDED:

Sustainable growth was not impacted by industry sector, size or country of origin.

Portfolio of initiatives and operations at different stages of

maturity and investment was needed

for sustainment

Identified resources weren’t the same

- different company initiatives require

different managerial skills and leadership.

3 HORIZONS

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• The heart of any business – the activities at the center of the business identity

• Typically, these activities account for the lions share of profitability and cash flow

• Usually have growth potential, but eventually will decline if not evolving

• Critical to near-term performance

• Critical to fund H2, H3 investment

• A well functioning H1 business is required for a company to “earn the right to grow”

HORIZON 1 – EXTEND & DEFEND THE CORE

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• Management challenge in H1 is to remain competitive and capture efficiencies / lower costs

• Innovation can incrementally extend H1 business life and growth

• Traditional Sales and Marketing can help H1 businesses

• Management must continue to re-shape, look for productivity, cost reductions and incremental innovation

• Traditional management approach – strong financial and non-financial KPI’s and reporting, focused on profitability per unit

HORIZON 1 –MANAGEMENT CONSIDERTATIONS

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• H2 Businesses are on the rise - typically fast moving, entrepreneurial ventures. Can be defined by new services, products, locations and technology etc.

• New forms of revenue

• Often still in concept form

• Significant profit may be some time away, but revenue is increasing

• Show potential to be significant profit generators but still defining and refining the product / service and delivery approach

• Have plan to complement (or replace) H1 business in the future

HORIZON 2 – BUILD EMERGING BUSINESS

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• Demand management attention to manage risks and opportunities

• Adjacent to core – complement core

• “Learn as you go” – agility is key

• May need more then 1 initiative of any 1 time

• Require different measures of success compared to a H1 business

• Entrepreneurial management required with flexible business plan

HORIZON 2 – MANAGEMENT CONDITIONS

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• Seed for future businesses or options on future businesses

• H3 options are rarely proven, but show promise

• Many (most!) will not succeed or progress H2

• Challenge is to nurture promising options while ruthlessly excising those with diminishing potential

• High risk due to uncertainty in market / high profit potential as market leaders

HORIZON 3 – CREATING VIABLE OPTIONS

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• Innovator / Futurist management style required - Strong focus on future trends / disruptions - Minimal financial KPI’s

• Allow much more unconstrained thinking, often allowed to operate outside of H1 business rules

• Don’t commit too much capital / resources

• Important for management to adopt a ‘fail-fast; fail-cheaply’

• Must have management support – H3 initiatives tend to suffer first from cost-cutting

• Incubator models -> capital allocation to “prove up” business case

• Resourcing / skills needed often sit outside today’s organisation

HORIZON 3 – CREATING VIABLE OPTIONS

Now its time to think what are your 3 horizon’s…

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THANK YOU

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