Scenario Analysis

Subject: Business Research & Methodology Professor in Charge: Seoksoo Kim Team Members(6): International Trade & Commerce - Seokhyun shin/Seokyoon Jung /Jungwon Byun International Logistics & Port Management - Jongjoo Kim/ Insoo Kim International Cooperation - Taeeun Kim

Case Studies: Case 1-10 (pp. 1638~654) based on Business Research Methods by William G. Zikmund

Definition
Scenario analysis is a process of analyzing possible future events by considering alternative possible outcomes(scenarios). The analysis is designed to allow improved decisiondecisionmaking by allowing complete consideration of outcomes and their implications.

Purpose
In order to exploit opportunities and minimize threats that exist in the external environment, companies must be able to analyze their internal strengths and weaknesses and implement strategies based on their particular resources, capabilities and core competencies.

Purpose


A Scenario is an internally consistent depiction of a possible future state of an economy or industry or technology Scenario analysis is a structured way of developing multiple scenarios Initial scenarios are conducted at high levels, subsequent scenarios may be at the firm level

Process
    

Identify Uncertainties Determine casual factors Make range of plausible assumptions Combine assumptions into scenarios Analyze industry behaviour under each scenario Determine strengths/weaknesses under each scenario Predict competitor behaviour

Scenario 1 : Case 1 & 2

[The Atlanta Braves/ Harvard Cooperative Society]

Context Analysis
The Atlanta Braves: Turner Field Building a newly-designed 21st Century form newlyof Baseball Stadium Spectators vs. Participants CustomerCustomer-oriented development
o o o o o

Bleachers are closer to the pitch. Enhanced supplementary facilities. RealReal-time broadcasting system. PricePrice-setting for the non-use seats(skyline seat) nonInteractive game equipment

Context Analysis
Harvard Cooperative Society New decision support system is required. Was the Harvard Square store attracting steady traffic? Were the college students buying enough books and supplies for the Coop to make a profit?

Primary Activities & other Support Activities

The Atlanta Braves Key marketing objectives: New generation of baseball fans Diversify fans activities at every turn. Fan s becoming part of what s happening at Turner Field after the minute a fan s ticket is torn.

Primary Activities & other Support Activities

Harvard Cooperative Society Key objectives: New era needs New System for a decision-maker decisionDecision Support System(Murphy s PC)
  

Up-to-theUp-to-the-minute, easy-to-read electronic easy-toreports on sales Electronic inventory check-up checkReport on gross margins for any product or suppliers

Scenarios designed for further questioning

The Atlanta Braves Marketing Mix Recommended Business Research Methods Role of Business Research Advantages of Decision support System

Marketing Mix
McCarthy identified the four P's of the marketing mix (40 years ago!) Product: Defines the characteristics of your product or service that meets the needs of your customers.

Price:

Decide on a pricing strategy - do not let it just happen! Even if you decide not to charge for a service (a loss leader), you must realise that this is a conscious decision and forms part of the pricing strategy.

Promotion:

This includes all the weapons in the marketing armoury advertising, selling, sales promotions, Public Relations, etc.

Some of the revolutions in marketing have come about by changing this P. Think of telephone insurance and the (or route of internet! A bit of lateral thinking here might reap rewards for distribution): your business.

Place

Recommended Business Research Methods

   

Secondary data gathering Mall intercept Interview Personal Interview Internet Survey

Role of Business Research

 

Identifying problems or opportunities Diagnosing and assessing problems or opportunities Selecting and implementing a course of action Evaluating the course of action

Advantages of Decision support System

Small Business Ex) UPC(Universal Product Code), Till System 1. Easy to access to the data 2. Easy to transform data into valid information 3. Easy to check-up inventory Capable of facilitating CRM (Customer Relationship Management)

Major Corporation

Transnational Global Information System Corporation/Organization

Scenario 2 : Case 3 & 9

[Tulsas Central Business District vs. New Williams Center Complex]

Context Analysis
Revitalization of Tulsa s Central Business District 1) 2) 3) 4) The Quantity and Nature of the Downtown Population Commercial Enterprise(and Vacancy) Inventory Business s Opinions about the CBD Shoppers Opinions about CBD

Context Analysis
A survey of the Central Business District employers and employees
o o o

Characteristics Work habits Attitudes

Context Analysis
A Survey of Commercial Establishments and Off-street parking facilities Offo o o

Types Sizes Location

Context Analysis
A Survey of Commercial vacancies
o o

Concentrating on ground-floor space groundConsideration given to multi-storey multicommercial building

Context Analysis
An On-the street Sample Survey of Onshopping attitudes and preferences
o

Addressing attitudes toward working and living downtown

Business Situations
The Williams Company Strength : Abundant Capital Weakness : Lack in information about new business
o o o

Internal resources Current Image of the company CasualCasual-user market information

Scenarios designed for further questioning

Critical Points on the Chamber of Commerce s Research Proposal NewlyNewly-suggested research proposal Research Model (Case 9: Mail Survey of CEO)

Critical Points on the Chamber of Commerces Research Proposal



 

Static Population vs. Dynamic flow of Population External networking of CBD Target Users of New Williams Center Complex : Business Runner/Shopper/ Resident

NewlyNewly-suggested research proposal

a)

Secondary Data Study

 

Literature Studies Benchmarking

NewlyNewly-suggested research proposal

b)

Survey
    

Mall Intercept Personal Interview Telephone Interview Mail Survey Internet Survey Panel Study

NewlyNewly-suggested research proposal

c)

Pilot Study
o

Focus Group Interview

Research Model (Case 9: Mail Survey of CEO)

The Chamber of Commerce in Tulsa
A.

B.

Sample Selection A systematic random sampling of firms in the second stratum was from Polk s City of Tulsa Directory( Reserve directory) Rate of survey returned : 61%

Research Model (Case 9: Mail Survey of CEO)

The Chamber of Commerce in Tulsa
C.

Problems
o o

Is collecting information of mail survey via CEO enough or valid? Mail survey can be cost-efficient , geographically costflexible, and convenient for respondents, and easy to gather generalized ideas on given task, however, it doesn t seem appropriate for the William Company considering its strength and longlong-term implementation plan.

Scenario 3 : Case 4

[Hamilton Power Tools]

Context Analysis
Most Sales are to Professionals Managements Awareness During the late 1970s and early 1980,
o o o o

Energy crisis Movement from urban and suburban areas to exurban areas Second homes in countryside Do-itDo-it-yourself trend

 

Necessity of target market expansion for the future growth Industrial user-based market to casual user(consumer)-oriented useruser(consumer)market

Context Analysis


Necessity of target market expansion for the future growth Industrial user-based market to casual useruser(consumer)user(consumer)-oriented market

Business Situations and Primary Activities

Strengths: Strengths: Market share in the industrial professionals and product technology are high. Weaknesses: Weaknesses: No preparation for the changing market trend and lack in the information on the casual-user market. casual-

Business Situations and Primary Activities

Motivational Research suggested by Consumer Metrics of Chicago: TAT Designed in use of consumer studies to uncover people s buying motives.
o

Means of gaining the flavour of the language people use in talking about chain saws Source of new ideas for copyright

Business Situations and Primary Activities

TAT Study Procedure for casual users toward chain saws Exhibit A : The cost of doing the job, and the ease and speed of using chain saw
o o o

Using a hand saw Hiring s tree surgeon Renting or borrowing a chain saw

TAT Study Procedure for casual users toward chain saws

Exhibit B : How to use chain saw Price related to Safety
o o o o o o o o o o o

Ease of handling Length of blade Which was the best brand Whether it had direct drive Whether it had gas protector SelfSelf-lubrication The warranty (guarantee) Ease of Controls Specifications Availability of credits Possibility of mixing oil and gas

TAT Study Procedure for casual users toward chain saws

Exhibit C : The fear of using chain saw except a DIY man Exhibit D : The value of purchasing chain saw

Scenarios designed for further questioning

Critical Points on TAT performed by Consumer Metrics of Chicago Recommendations to Campagna concerning the Casual-user chain Casualsaw market

Critical Points on TAT performed by Consumer Metrics of Chicago

Does this meet the need of Hamilton Power Tools inquiry?
o

It doesn t seem relevant to greater profitprofitmaking in the chain saw division Need to be revised in pictures

Critical Points on TAT performed by Consumer Metrics of Chicago

Hamilton seems targeting the home owned male users market only. Purchasing vs. Renting
o

The method seems invalid and unreliable to increase the sales of chain saws in casual-user casualmarket. Since most of users of chain saws consider not only the usability, but the cost. When you can rent out the chain saw for temporal use, why bother purchasing one.

Recommendations to Campagna for the Casual-user chain saw Casualmarket

1)

2) 3) 4)

Contribute to the physical creation of the product or service and its sale Transfer to the buyer Enhance after-sale service afterResearch the competitor in the target market

Scenario 4 : Case5

[Middlemist Precision Tool Company]

Context Analysis
Validity and Reliability of the newlynewlydeveloped radial arm saw (using T square and trial cuts) invented by Dennis Middlemist in the market. The market potential
o

How many arm saws there in the US and patent issue How many prospective customers there might be for his invention

Scenarios designed for further questioning

Research existing similar products
o o

Secondary Data Patent Record

Prospective Customers Research

o o o

Focus Group Experimental Survey(Testing) Secondary Data collected via Internet

Prospective Customers Research



What is Radial arm saw and what is the primary concern of the customer in using it?
http://www.sawdustmaking.com/

Research example:
http://www.sustain.ubc.ca/

Research on existing goods

http://woodbutcher.net/toolpix.htm

Example of the Market research planning http://www.concept.ntnu.no/

Scenario 5 : Case 6

[EZPass]

Business researcher vs. Task force

Business researcher: researcher: Assessing commuters demand for the service is important. Task force : The principal role is to investigate commuter s preferences for how the service should be configurated ideally.

Recommended Research design

TrafficTraffic-concentrated area Interview Telephone Interview Mail survey Internet Survey

o o o o

Scenario 6 : Case 7

[Todays Man]

Hypnotic treatment in Business Research

Advantages : It can help to minimize or reduce
o o o

Nonresponse bias Acquiescence bias Social desirability bias

Disadvantages :
o

Ethical argumentations.

Additional research recommended



Survey Questionnaire design with 3rd3rdperson technique RoleRole-play: ex) Psycho drama rather than hypnotism or mesmerism

Scenario 7 : Case 8

[Coral Gables, Florida]

Mock jury and its evaluation

Demographics and Values of evidence presentation at bar PercepTrac
o

A handled device that mock jurors use to gauge their positive Negative responses to facts presented in a trial.

The effectiveness of jury research

Easy to test Voodoo legistigation

Survey errors

Sample selection error Response bias Auspices bias

Scenario 8 : Case 10

[The Greeting Card Study]

Evaluation of the covering letter

Compare it with the Exhibit 10.2 : Examples of Cover Letter for Household Survey
o o o o o

o o o o o o o

Official letterhead Date mailed Inside address in matching type What study is about; its social usefulness Why recipient is important (and if needed, who should complete the questionnaire) Promise of confidentiality; explanation of identification number Usefulness of study Token reward for participation What to do if questions arise Appreciation Pressed blue ballpoint signature Title

Possible survey error

Nonresponse bias Deliberate falsification

Conclusion

Interactive Scenario Analysis

Case Study and Scenario Analysis Presenter and Audience Interaction

The End

Any Questions?