What is a Value Chain? The term value chain refers to the various business activities and processes involved in creating a product or performing a service. A value chain can consist of multiple stages of a product or service’s lifecycle, including research and development, sales, and everything in between. The concept was conceived by Harvard Business School Professor Michael Porter in his book The Competitive Advantage: Creating and Sustaining Superior Performance. Examining the processes that make up a company's value chain can give you a better understanding of what goes into each of its transactions. A company can be better positioned to share more value with consumers while capturing a larger part of the value created at each point in the chain by maximising the value created at each point in the chain. Understanding how a company generates value can help you gain a better grasp of its competitive edge. What is Value Chain Analysis? Value chain analysis is a method of assessing each activity in a company's value chain to determine where improvements might be made. A value chain analysis forces you to analyse how each step contributes to or detracts from the value of your end product or service. As a result, you may be able to gain a competitive edge, such as: Cost reduction - by making each activity in the value chain more efficient and, therefore, less expensive Product differentiation - by investing more time and resources into activities like research and development, design, or marketing that can help your product stand out Components of a Value Chain? According to Porter’s definition, all of the activities that make up a firm's value chain can be split into two categories that contribute to its margin: primary activities and support activities. Primary activities are those that go directly into the creation of a product or the execution of a service, including: Inbound logistics: Activities related to receiving, warehousing, and inventory management of source materials and components Operations: Activities related to turning raw materials and components into a finished product Outbound logistics: Activities related to distribution, including packaging, sorting, and shipping Marketing and sales: Activities related to the marketing and sale of a product or service, including promotion, advertising, and pricing strategy After-sales services: Activities that take place after a sale has been finalized, including installation, training, quality assurance, repair, and customer service Secondary activities help primary activities become more efficient—effectively creating a competitive advantage—and are broken down into: Procurement: Activities related to the sourcing of raw materials, components, equipment, and services Technological development: Activities related to research and development, including product design, market research, and process development Human resources management: Activities related to the recruitment, hiring, training, development, retention, and compensation of employees Infrastructure: Activities related to the company’s overhead and management, including financing and planning How to conduct a Value Chain Analysis? Identify Value Chain Activities The first step in conducting a value chain analysis is to understand all of the primary and secondary activities that go into a product or service’s creation. If a company sells multiple products or services, it’s important to perform this process for each one Determine the Cost and Value of Activities After identifying the primary and secondary operations, the next step is to assess the value that each activity brings to the process, as well as the associated expenses. It's critical to comprehend the prices linked with each stage of the procedure. Depending on the situation, you may discover that cutting costs is a simple method to increase the value of each transaction Identify Opportunities for Competitive Advantage Once you’ve compiled your value chain and understand the cost and value associated with each step, you can analyze it through the lens of whatever competitive advantage you’re trying to achieve. Using value chain analysis, you can uncover several opportunities for your firm, which can prove difficult to prioritize. It’s typically best to begin with improvements that take the least effort but offer the greatest return on investment. Example - McDonald's Value Chain Analysis Image Source: Hubspot Blog Did you like this article? Do let me know in the comments. Any feedback and suggestions are most welcome If you want me to cover some particular topics, do let me know in the comments!

What is a GTM aka Go-To-Market Strategy? A go-to-market (GTM) strategy is a plan that outlines how a company might engage with customers in order to persuade them to acquire a product or service while also gaining a competitive advantage. Pricing, sales, channel tactics, the buying journey, new product or service releases, product rebranding, and product introduction to a new market are all part of a GTM strategy. Don’t get confused between a go-to-market (GTM) strategy with a business plan. While they are related, they are different. A business plan is broader in scope and considers every aspect of a business, while a go-to-market strategy is focused specifically on delivering a product or service to an end customer. Why Do You Need a Go-to-Market Strategy? GTM strategies serve a multitude of purposes for any company goal including: New Products or Services launch New Markets: A GTM plan for testing known and unknown untapped markets Existing Markets: Products that are currently offered need to adapt to evolving markets. Creating a GTM strategy gives time to evaluate what makes your product successful (and unsuccessful) Cross and Up-selling: Retaining current customers is great for the revenue stream, and using their buying behaviour and loyalty to market other same category products or cross-category products to create more value for the customers as well as for the brand 5 Steps for Developing a Go-To-Market Strategy Define your target market Most businesses begin by deciding what services they wish to provide and it's best to begin with the challenges you want to solve or, much better, the markets you want to be in. Growth, geographic location, and existing client base are all significant factors to consider when choosing markets. Do some secondary research and build hypothesis or market knowledge and try to validate it via primary research Customer segmentation Which segment are you likely to add the most value to? Which segments are most likely to be a good fit with your firm? These are your target clients. It’s not a matter of who can use your service. It’s quite likely that many prospects could. But that doesn’t mean you should target them all. You will likely have no advantage, just a very difficult time closing prospects. Try to segment it as niche as possible considering your business idea Brand positioning In relation to your competition, how do you want your product/service to be perceived? Do you want to be a trailblazer? who is the thought-leader? a low-cost alternative? Of course, each of these options would have a very distinct market posture. If you're aiming to reach out to young hustlers and innovators - your positioning and service mix should reflect that. Young, inventive, and hustling. Define the offerings Most people start here and search for the right target audience and that’s a mistake! The offerings should flow from the target and positioning, not the other way around. What services address the specific needs of the niche you've chosen to focus on? What role do these products play in reinforcing your brand? Are your services actually innovative if you portray yourself as innovative? Do you have high-value, low-cost services that aren't available anywhere else in your market if you're marketing yourself as a low-cost alternative? With a low-cost GTM plan, be careful not to paint yourself into a corner. When you want or need to raise pricing, this could come back to harm you. Not to mention the possibility of ruthless, no-win pricing fights with rivals. Develop a fantastic marketing strategy Your marketing approach should correspond with your target customers' preferences, just as your service offerings should deliver on your brand promise. Reaching and encouraging them will be much easier with a marketing strategy that speaks their language and directly tackles their "pains." This what channels your target customers use the most. If you targeting Gen Zs, then social media or online channels are one of the many channels that you should never miss. Based on the customer segmentation that you have created, deduce their psychographics and behavioural patterns and use them in your marketing strategy. Attaching two snaps of the Marico Over the Wall B-School Case study competition, the first round was to prepare an executive summary - this contains the elements of the GTM strategy of a new product Did you like this article? Do let me know in the comments. Any feedback and suggestions are most welcome If you want me to cover some particular topics, do let me know in the comments!

MECE Segmentation - mutually exclusive and collectively exhaustive MECE is a method of segmenting data into mutually exclusive and collectively exhaustive sub-elements. To put it another way, elements should “exclude” each other, that is, they should be different, and they should “exhaust” the relevant field, that is, they should contain all that belongs to it. When creating an issue tree for your case structure, MECE should be utilised as a method. This will help you prevent dependencies between distinct branches of the tree, allowing you to separate sub-problems properly. MECE segmentation is an effective way to structure the analysis while solving a case study. Mutually Exclusive: seeks to simplify things by avoiding overlaps. You must ensure that the possible solutions or groups are not considered twice by mistake Collectively Exhaustive: ensures a complete collection without leaving any options. All potential options have been studied exhaustively Let’s learn the difference between MECE and Non-MECE Let's take the example of the famous game - “Among Us”. We have two types of character/group there – the crewmates and the imposters! Now imagine there are 4 imposters and 5 crewmates! ( Who do you think will win here?) Characters in both the groups have their own goals and these goals are not similar, right? And there is no 3rd kind of character This is an example of mutually exclusive and exhaustive when no person can be in both groups - mutually exclusive - but every person is in either one of them – collectively exhaustive! – MECE! And Peace! Now imagine, you are playing Among Us with one of your friends on a live call and your friend got the imposter role and you got the crewmate's role. After disclosing the roles to each other, you decided to play dirty to your crewmates ( or to your group) by masking your friend's role as a crewmate (during the vote-kick out session, by the way, have you ever done this kind of act?) Now to everyone, your friend is a crewmate but in actuality, he/she is an imposter! This is an example of not exclusive and not exhaustive (for not-exhaustive imagine someone who is facing a huge lag and is not playing at all) I hope now you are now clear with the concept of MECE. MECE is extremely important in problem-solving because it ensures complete coverage of the problem, helping to identify all possible root causes to ensure maximum-impact solutions. It also prevents effort duplications, saving time and resources. In other words, the problem is solved with the highest effectiveness and efficiency. The MECE idea is incorporated into many well-known frameworks, such as Cost-Benefit Analysis, 4Cs, and Porter's Five Forces 4 Rules that you should follow Parallel items The first “hidden rule” of MECE is that all items have to belong on the same logical level. Logical connect Items should be arranged in a logical fashion to extract the most benefits. Three or free! According to the "Rule of Three," groups of three objects are the most intuitive to the human mind, making knowledge easier to store and process; small groups of items also take less time to describe. No dependencies Interdependence between the items will create confusing issues across the structure, making it more difficult to build the overall structure! Did you like this article? Do let me know in the comments. Any feedback and suggestions are most welcome If you want me to cover some particular topics, do let me know in the comments!

What is "Market Size"? Market size is the number of individuals in a certain market segment who are potential buyers. We will understand this concept in a stepwise manner and at the end of this article, you will understand why this is so important in any businesses. Let's take a scenario, you are an MBA student and is taking part in a case study competition. The ask of the competition is to build a product, in any one the segment that the company does the business. For simplicity let's assume the segments are - Food, Health and hygiene, Skincare, Personal care and Education. Understanding the problem you solve for clients and the potential value your solution provides for them is the starting point for determining market size. This is a component that many of you ignore because you are too focused on the product you have created to consider how it will help the audience Estimating the Market Size! Step 1: Define your "Target Customers"! This exercise consists of four steps to help you estimate the total market potential for a product. The individual/group for whom your product addresses a specific problem is your target customer(s). So the first step is to determine who your ideal customer is and make a profile of your ideal/typical target customer. Given the importance of establishing your target consumer, it's critical to allow appropriate time for this first step analysis. Case study: (Refer to above-mentioned scenario) After getting the requirement, researching on the given segments (Food, Health and hygiene, Skincare, Personal care and Education), analyzing the different challenges and need in the respective segments, you decided to go with food segment. The need that you have found is the lack of diabetic food available in the market and the target customer here would be diabetic patients. Now diabetic patient category is also very broad, so you have decided to narrow it down and focus on the diabetic working segment. The region/launch market that you have selected is Mumbai Step 2: Estimate the number of Target Customers This is one of the crucial stages, here you are required to estimate the total number of target customers in the market. Keep in mind one thing, it is absolutely fine to not the exact number. But you can refer to research papers or news or census data or consultancy report to guesstimate the number Case study: After defining the target customer, you have done some more research with respect to the segment that you have defined and what you have found out is the total market size is in the range of 140000 - 160000 ( all the values here are hypothetical and there is no correlation with the actual dataset). For this, you are considering 160000 as the total target customer size Step 3: Figure out the "Penetration Rate" Market penetration is a crucial indicator as to whether your marketing and sales strategies are working. Market penetration is the percentage of identified potential customers you have acquired. You can figure out this number by referring to similar companies data. Say if you are building a product in a diet food sector, then refer to similar companies and their product, what is their penetration rate. Just for your information, the penetration rate is easy to calculate if you know your target market size. To calculate the penetration rate, divide the number of customers you have by the size of the target market and then multiply the result by 100. Penetration Rate = (Number of Customers ÷ Target Market Size) × 100 For example, if you sell a diabetic food product in a metro city that has 160000 diabetic patients/potential customers and your product is being used by say, 10000 customers, then the penetration of your product would be: 6.25% Penetration Rate = (10000 ÷ 160000) × 100 = 6.25 Case study: You referred to your competitors' data, connected with different wholesalers and retailers and found out that the penetration rate of the competitors' product (similar product and segment that you have selected) is in the range of 10-18%. For this, you have assumed the average i.e. 14% for your market size estimation Step 4: Potential Market Size! Market Volume To find the overall market potential (that is, the potential market volume), multiply your number of target customers by the penetration rate Market volume = Number of target customers × Penetration rate So from all the above steps, the data that we have is: Number of target customers = 160000 Penetration rate = 14% Market size in terms of volume = 160000 X 0.14 = 22400 customers Market Value Market value is nothing but the total sales value from market size. To calculate the monetary value of the market, multiply the market volume by your average value (that is, price expectations). Market value = Market volume × Average value For this, let's assume that the selling price of your product would be INR 100 per quantity. Market value = 22400 x 100 = INR 2240000 Final note Market size estimation, from the name only it is evident that it will give you only the estimate and not the actual figure. But you can always optimize this by: By making your first estimate and examining each assumption you make and what would cause it to change. To factor in the risks of change, calculate best-case and worst-case scenarios in addition to your expected scenario. Over time, monitor the accuracy of your initial assumptions and whether you need to modify them. Did you like this article? Do let me know in the comments. Any feedback and suggestions are most welcome

The term "break-even analysis" refers to the point at which a company's total cost and total revenue are equal. The number of units or dollars of revenue required to cover all costs is determined using a break-even point analysis (fixed and variable costs). The formula for Break-Even Analysis The formula for break-even analysis is as follows: (In terms of quantity) Break-even quantity = Fixed costs / (Sales price per unit – Variable cost per unit) Where: Fixed costs are costs that do not change with varying output (e.g., salary, rent, building machinery). Sales price per unit is the selling price (unit selling price) per unit. Variable cost per unit is the variable costs incurred to create a unit. It is also helpful to note that sales price per unit minus variable cost per unit is the contribution margin per unit. For example, if a book’s selling price is INR 100 and its variable costs are INR 20 to make the book, INR 80 is the contribution margin per unit and contributes to offset the fixed costs. The formula for break-even analysis is as follows: (In terms of Sales) Break-even sales = Fixed costs /[ (Sales – Variable costs)/Sales] Where: Fixed costs are costs that do not change with varying output (e.g., salary, rent, building machinery). Sales here is the total sales value Variable cost is the total variable cost incurred The contribution margin ratio is the difference between a company's sales and variable expenses, expressed as a percentage. The total margin generated by an entity represents the total earnings available to pay for fixed expenses and generate a profit. When used on an individual unit sale, the ratio expresses the proportion of profit generated on that specific sale. The break-even point is the point at which total fixed and variable costs equal total revenues. A business does not make a profit or a loss at the break-even point. As a result, the break-even point is often known as the "no-profit" or "no-loss" threshold. The break-even analysis is important in determining how many units (or revenues) are needed to cover fixed and variable expenses of the business. Therefore, the concept of break-even point is as follows: Profit when Revenue > Total Variable cost + Total Fixed cost Break-even point when Revenue = Total Variable cost + Total Fixed cost Loss when Revenue < Total Variable cost + Total Fixed cost But, there are "Limitations" Break-even analysis plays an important role in making business decisions, but it’s limited in the type of information it can provide. Not So Dynamic The formula for calculating the break-even point is straightforward. Many firms sell a variety of products at different rates. That nuance won't be picked up by it. You'll probably have to work with one product at a time or make an average pricing estimate based on all the things you'll be selling. If this is the case, it's a good idea to practise a few different scenarios in order to be more prepared. As prices fluctuate, so do costs. This model assumes that only one thing changes at a time. Instead, if you lower your price and sell more, your variable costs might decrease because you have more buying power or are able to work more efficiently. Ultimately it’s only an estimate. Not the Right "Time" The break-even analysis overlooks time variations. The time frame you choose to compute fixed expenses will determine the time frame you use (monthly is most common). Although you'll be able to see how many units you need to sell over the course of a month, you won't be able to see how things alter if your sales move week to week or seasonally over the course of a year. It also neglects to consider the future. Break-even analysis just considers the present. No Demand Predictions It's vital to remember that a break-even analysis isn't a demand prediction. It won't tell you how much money you'll make or how many people will want to buy what you're selling. All it will tell you is how many units you need to sell to break even. It's also worth noting that demand isn't consistent over time and you have to keep a note of these variations and balance it out if required.

Secondary research or desk research is a research method that involves using already existing data. Existing data is summarized and collated to increase the overall effectiveness of the research. Secondary research includes research material published in research reports and similar documents. The data points, although they are existing, are not easily accessible. Either they are highly-priced, or need some kind of subscriptions and so on. These are some of the hacks which I personally use when I do secondary research and trust me these hacks work like a charm! 1. The "Case Studies aka Customer success stories" Let's start with the basics, "What is a customer success story?" Customer stories usually go into further detail on how the outcomes were obtained and what compromises were made along the way. A customer tale that can be thought of as a means to provide the intended audience with a "sneak look" into what might be their reality. This sneak peek provides enough information if you are conducting any secondary research, information in terms of impact in different KPI, such as revenue, customer acquisitions, lead generations, etc. For example, Adobe customer success stories, Amazon (AWS) customer success stories, Hubspot case studies and many more. These data points will help you to narrow down your solution, to guesstimate the trend and project the outcome of your solution with proper justifications. 2. Consultancy Reports - One for all, All for one Consultancy reports are written for a non-specialist audience. Often they are written in response to a request for information from an organisation or business or just for the normal audience ( marketing strategy?). The best part of these reports are, they are FREE! and BEAUTIFUL! and EASY TO UNDERSTAND! and FULL OF INFORMATION! These numerous firms conduct periodic surveys, on an organizational level, industry level or general and compile all the data into meaningful insight for the general public to consume it. e.g. Deloitte Industry Outlook, (set the region before you access the reports to get more region oriented information) 3. Google Scholar - When Google is not enough Google Scholar is a freely accessible web search engine that indexes the full text or metadata of scholarly literature across an array of publishing formats and disciplines! Google Scholar aka the academic version of Google, will save the day by searching repositories of publishers, universities or scholarly websites rather than carrying out a generic web search. There are multiple filters available (not as robust as Google, but eh! something is better than nothing!) 4. Slideshare - The underdog SlideShare is a slide hosting service, acquired by LinkedIn in 2012. It allows users to upload files (PowerPoint, PDF, Keynote, or OpenDocument presentations) either privately or publicly. The advantage of Slideshare is that users can upload files privately or publicly in PowerPoint, Word, PDF, or OpenDocument format. Content can then be viewed on the site itself, on mobile devices or embedded on other sites. SlideShare also provides users with the ability to rate, comment on, and share the uploaded content (yes! just like this blog) and these features helps you in filtering the right content 5. YouTube - One with the videos! YouTube needs no introduction, but this source is a treasure chest for a data thirsty researcher if used properly. This platform holds almost all the videos that you might see in the above pointers, e.g. in customer stories, consultancy webpage, etc. Use the YouTube search engine wisely and the advance filters that are available! 6. By Hook or By Crook Disclaimer: Please do this when you don't have any other options left! There are many firms who sell organizational/industry level reports just like consultancy firms (they are also into consultancy, most of them!) but at a cost (>2000USD). e.g. Marketresearch.com, Reportlinker, Plunkett research and many more. You can search for your desired industry and ask for a sample report! There are many other hacks/techniques to do secondary research effectively but one thing that is a must in all the above-mentioned points, e.g. smart Google search techniques. Do share your feedback in the comments, if you have any other strategy, do share!