At Avalon Consulting, we believe that strategy formulation is a deliberate search for a plan of action that will develop a business’ competitive advantage and compound it.
Strategy is one of the most commonly used management terms, yet it is also the least understood. Often companies underestimate the power of good strategy or confuse tactical initiatives with strategy. Smaller organisations believe that strategy is only for the large companies while the truth is often the reverse. Senior management is often too close to the daily issues to be able to take a detached and clinical view of the long term. These are typical conditions where our strategy team steps in to deliver results.
Avalon’s strategy formulation exercise focuses on maximising client shareholder value while effectively managing risks. The process involves identifying the key success factors in any given situation and then designing an organisational framework to excel at each of these factors. Several disparate pieces of the organisational puzzle are addressed in designing the strategy – the core value proposition, product / business portfolio, organisation structure, leadership, skill sets, key operational processes and systems and so on – and combined under one unifying theme.
Strategy formulation can be a holistic exercise encompassing the entire organisation (corporate strategy) or can be localised (functional strategy) based on the magnitude of the problem or the company’s appetite for change.
Our strategy practice offers clients a range of options. Please click on a practice area for further details.
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| Corporate and Business Strategy |
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Diversified companies or businesses with multiple product lines need advice on how to ensure maximum value extraction and attractive RoCE for each of their businesses / product lines. We empower organisations in making these decisions through our strategy exercise which involves an in-depth analysis of the businesses that our clients operate in. This includes understanding their market environment, evolving various strategic alternatives, evaluating these alternatives vis-á-vis the internal operations and strengths of the client and making choices that will achieve the desired objectives. We do not merely identify the appropriate choices but also come up with a definitive action plan to implement the same.
Corporate Strategy exercises are carried out at the level of the Group and evaluate the comparative attractiveness of various businesses the company may choose to enter or is already operating in. Business Strategy operates at the next level and enables business heads to resolve complex issues surrounding their product portfolios, product line adjacencies, geographic spread, relative resource allocation, etc. |
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| Mergers & Acquisitions Strategy |
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Acquisitions, at times, are the preferred routes to entry into new markets / geographies. Our M&A practice focuses on helping clients identify targets for acquisition based on defined strategic and operational parameters as well as handholding them through the process of making the acquisition.
Our Commercial Due Diligence process helps clients who are in the process of acquiring another company. Clients in this process typically need visibility on the veracity and achievability of the business plans of their targets. We leverage our understanding of various markets and industry verticals in order to undertake an intensive business audit to enable our clients to take an informed view on the business plan and hence the valuation of the target.
By the same token, our Vendor Due Diligence practice assists clients who are being acquired in ensuring that they communicate the true value of their enterprise to the investor. This is achieved by ensuring that a sound strategy is in place to drive and achieve strong growth. We also help clients put together detailed business plans and presentations communicating the expected value enhancement. Our association with clients also extends to supporting the due diligence process and preparing the data room. |
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| Product and Market Strategy |
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Our Product and Market Strategy offerings focus on reviewing the client’s product and market portfolio with a view to helping managers achieve growth and / or maximise margins.
We help our clients plan for growth by analysing the opportunity around new products and markets. The assessment involves careful study of the opportunity size, prevailing competition, routes to the market and the regulatory environment. Our strategy recommendations provide not only an insight into the size and nature of the opportunity but also spell out how the opportunity should be addressed.
We also help our clients enhance their margins through our product and market portfolio optimisation offerings. By analysing the profitability of products and markets in the portfolio, we assist our clients in identifying the products/ markets that are destroying value and also those that are contributing the most and hence need to be protected.
Our solutions encompass the 3 Ps – Purpose, People & Processes enabling clients to hit the ground running while implementing the strategy.
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| Brand Portfolio Strategy |
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With the increasing proliferation of brands and declining consumer loyalty, brand management has emerged as a major challenge for product and service companies. Often there are similar brands from the same stable competing for the customer’s mindshare leading to confused audiences and inefficiencies in market spends. On the business front, this has resulted in reduced profitability, poorly utilised capacities and a diluted sales focus.
Avalon’s Brand Portfolio Strategy practice works with companies to instill clarity in brand management. We believe that each brand has a clear and differentiated role in the portfolio. The portfolio strategy is a forward looking model that also allows for future growth and new product development. We work closely with the client team to understand the strategic imperatives of the company and its in-house competencies. This understanding is juxtaposed against a detailed analysis of historical trends in the target consumer segments, retail requirements and category attractiveness. The result is a comprehensive portfolio architecture that maximises synergies between brands and lays down the direction for future growth.
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| Supply Chain Strategy |
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The supply chain, both upstream (towards suppliers) and downstream (towards customers), is the lifeline of any business. Therefore it is imperative for companies to first ensure that an effective supply chain is designed as per the needs of the business and second, constantly review the supply chain for possible issues and resolve these issues before they create bottlenecks.
Our Supply Chain Strategy practice works with companies to resolve a range of issues from designing supply chains to creating distribution structures with an objective of increasing reach, enhancing service levels, optimising inventory, reducing overall distribution costs, optimising the sales force, defining parameters and scorecards for channel performance evaluation, developing decision support systems, etc. We use state-of-the-art modelling tools and best practices gathered over several years of experience working with both B2C and B2B companies.
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| Pricing and Promotion Strategy |
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Intensifying competition has made pricing an increasingly complex task. The consumers today are more aware than ever of the price they pay for a product and the value it delivers. Therefore companies today can no longer get away with traditional pricing mechanisms. Round the year promotions further complicate the pricing process. Hence it is imperative that companies, in order to remain competitive, should design and execute innovative pricing strategies based on a thorough understanding of their product’s value proposition and its value as perceived by the consumer.
We apply our experience of working with Indian and international consumer and industrial goods companies to help clients examine their comparative pricing basis, price architecture, roles and profitability of channel elements, promotion effectiveness, competitor activity, etc. to create winning pricing and promotion strategies. |
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| Strategic Cost Management |
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Cost reduction is usually conducted as a reactive, short term activity, not a proactive business philosophy. It is seen as a panacea for external pressures like a recession, stiff competition and dipping sales graphs. Very often, this results in companies compromising the long term strategic advantages they enjoy.
Strategic Cost Management (SCM), on the other hand, is the managerial use of cost information explicitly directed at business strategy formulation, implementation and control. The Avalon Consulting SCM framework encompasses all facets of a company’s operations and utilises various management tools including Value Chain Analysis, Strategic Positioning Analysis and Business Cost Modeling. |
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| Cash Cycle Optimisation Strategy |
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Cash is ALWAYS King, irrespective of the economic climate. A firm's 'Cash-to-Cash' Cycle is one of the key measurements of the operating efficiency of the extended value chain, and measures the time the operating capital (cash) is 'out of reach' for use by the business. Research has shown that good performance on the cash-to-cash cycle is associated with higher earnings per share.
Avalon Consulting's "Cash to Cash Optimisation " offering assists companies to extract maximum benefit from the operations cycle. It helps companies shorten the cash conversion cycle by understanding the business' strategic imperatives and specific context, diagnosing the current cycle, and recommending improvements in processes and activities across the value chain. Using simple but powerful diagnostic tools and templates, we help companies streamline their operating cash flows and reduce working capital requirements. Our inclusive approach ensures that the improvements benefit all members of the extended value chain, resulting in a truly optimised cash cycle, while ensuring that specific business requirements are not negatively impacted. |
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