Dec 13, 2015
IU Professional Opportunities Orientation Program (Strategic Planning)
• About ATA
• Strategy Concept
• Strategic Planning’s Role in Business
• A Day in the Life
About ATA(Growth and Diversification)
1973 J. George Mikelsons founds Ambassadair Travel Club in Indianapolis
1978 Deregulation of U.S. Airlines
1982 ATA begins Charter service, total revenues of $30.5M
1986 ATA begins Scheduled service, total revenues of $185M
1996 Strategic Planning forms, total revenues of $750M
1999 Revenues exceed $1B; ATA is certified as a major carrier
2000 Projected revenues to exceed $1.3B; Placement of $2B aircraft order
About ATA(Corporate Structure)
ATA is the 11th largest U.S. airline and the number one passenger charter airline in the Western Hemisphere
1999 ACTIVITY 1999 ACTIVITY
10,913,081,000 Revenue Passenger Miles 7,773,444 Passengers 157,481 Block Hours Flown 400+ Airports Visited 50,207 Departures 78,602,678 Miles Flown (=3,156 times around the world)
AIRCRAFTAIRCRAFT
24 Boeing 727-200 Advanced 13 Boeing 757-200 Extended Range 14 Lockheed L1011-50/100 5 Lockheed L1011-500 56
EMPLOYEESEMPLOYEES
3,000 Crew Members 694 Reservationists 1,113 Airline Mechanics 1,823 Corporate Staff 6,630
About ATA(Company Profile)
Emergence of Fact-Based Decision Making
Strategic Planning groups emergeMBA programs surgeProliferation of the PC1990s
Tom Watson, CEO of IBM estimatesglobal computer demand to be 5
Arthur Andersen’s GLICIACaccounting computer
1950s
1970s Ascendance of strategy consulting US firms falter in international competition
Great Society educates more of the emerging workforce than at any other time in history
IBM sells thousands ofSystem/360 mainframes
BCG develops framework to quantify strategy1960s
SEC begins to protect investors Financial performance and operating statistics publicly disclosed 1930s
Engineering principles applied to organization structure and production efficiency
McKinsey forms firstmanagement consulting firm
1920s
US Army leads research in industrial organization and psychology
Principles of Scientific Management
Management definedas creating worker productivity1910s
PIMS study scientifically connects relative market share to financial performance
Visicalc/Lotus 123 revolutionize investment banking1980s
Customers
Capabilities Costs
Competitors
Give customers what they will pay for in a way that is tough to imitate
• What business are we in?• What do we do better than
anyone else?• What other customer groups
will pay for our capabilities?
• For what will they pay how much?
• How many are there?• How many will there be?
• What are our costs relative to our competitors?
• What are our costs relative to what our customers are willing to pay?
• Who are they now?• What do they do better or
worse than we do?• Who could they be?
Financial Performance
Competitive Advantage = Sustainable Financial Performance
Strategy is Conceptually Straightforward
0%
7%
14%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 18 20
Per
cen
tage
of
Com
pan
ies
Strategic Planning Profile(Group Size)
Source: Corporate Strategy Board research
Half of the leading strategic planning groups have six or fewer professionals...
8%
4%
12%
9%8%
6%
2% 2%1% 1%
2%
6%
9%
7%
3% 3%
2%
3% 3%
9%
+
48%ATA
1998 1999
6 12
2000
11
21%
42%
60%
36%
76%
40%
19%
20%
37%
0% 50% 100%
Venture Capital
Knowledge Management
New BusinessDevelopment
Internal Consulting
M&A
Business Unit Planning
External Scanning
Corporate Planning
Special Projects forCEO, Board
Secondary
Primary
Strategic Planning Profile(Responsibilities)
Source: Corporate Strategy Board research
…but tackle a broad range of high impact projects
ATA
20%
10%
10%
20%
19%
19%
23%
49%
50%
13%
52%
78%
78%
30%
10%
Strategic Planning Process
Research
• Internet
• Libraries
• Proprietary databases
• Trade press
• SEC information
Analysis/Modeling
• Economic modeling
• Regression
• Risk Adjustment
• Excel
• Optimization Software
• Access
Understanding
• Group sessions
• Brainstorming
• Hypothesis testing
Communication
• Simplify
• Encapsulate
• Logical
• Story
Strategic Planning- Team oriented
- 55 Hrs per week
- 5-10% travel
- Opportunity to work
with other departments
Strategic Planning Profile
Proforma
Financials
FINANCE
Process
Diagrams,
Labor
Negotiations
OPERATIONS
Market
Analysis
MARKETING
Database
Building
INFORMATION
SYSTEMS
• Seek significant value for company/shareholders
• Detail evolution of potential value
• Highlight historical information and project future developments
• Consider competitive picture
• Create detailed business plans– Income statements– Balance Sheets– Cash flows– Operating statistics
A Day in the Life(Sample Strategic Planner Contribution)
• Desire to work hard and create an immediate impact
• Enjoy numbers and analysis
• Understand goals of a particular assignment
• Conduct comprehensive research to build relevant database
• Develop rational assumptions where data not available
• Build economic model using data and assumptions
• Communicate solution– restate goals– review analysis steps– provide clear graphical representation– make recommendations– calculate economic value added
How Do I Succeed?
Indiana University Schedule
DATE EVENT TIMES
11/03 On Campus Interviews 6:30 pm – 8:30 pm
11/02 Information Session
12/10 thru 12/20 Offers Made
7:00 pm – 8:00 pm