BCG Case-8 Seize Advantage in a Downturn by David Rhodes and Daniel Stelter 26 Nov 2009

Summary Selalu berpikir cari box yg baru – Box lama: cara lama – Box baru: cara baru Bukan sekadar berpikir out of the box

Summary Rash action (create sense of panic) - “Simultant” Deffensive and Offensive (cepat dan terukur: RAPID & Measured) How Much is the Business Exposure Response To stall 1.Build Scenario Tahu berapa Business Exposure Simultant 1. Managing Business Exposure (Defensif) 2. Gain long term Advantage (Ofensif) Simultant 1. Managing Business Exposure (Defensif) 2. Gain long term Advantage (Ofensif) Defensif: Managing Business Exposure Defensif: Managing Business Exposure Implementation by Establish Team -Monitor -Priority -Sense of Urgency Reborn from Crisis In action More worst (note: grammar nya aneh) Ofensif Gain Long Term Advantage Ofensif Gain Long Term Advantage Pursue Opportunity Rethink Business Model Note: Terjadi pada good company pada bad industry. Yg mikir adalah CEOnya. Kl pada turn around, CEOnya diganti

Restructuring from Growth NOTE: Jika struktur kita sudah tidak FIT (misfit), kita lakukan restructuring Cara melakukan restructuring – Reengineering – Redesign – Rebuilding (reduction tidak termasuk restructuring) Restructuring dilakukan jika terjadi underperform business, bukan krn krisis Underperform busines: jika return yg diberikan perusahaan (RoE) lebih rendah dari return yang diminta share holder (ke) Corporate restructuring is not an end in itself but rather a means for companies with underperforming business to achieve value building growth over the long-term

Restructuring from Growth NOTE: Underperform busines: jika return yg diberikan perusahaan (RoE) lebih rendah dari return yang diminta share holder (ke) Cara jepang utk lakukan restructuring: Perusahaan A di posisi (1), dibawa dulu ke (3) dengan cara buang yg idle tapi dapatkan uang, kemudian ke (4) uang tersebut akan dipakai untuk investasi dimana bank tidak mau berikan loan, baru perusahaan bisa mencapai (2) (+)0(-) RoE - Ke (+)0(-) Asset Growth 1. g=(+) RoE < Ke (underperform business  target restructuring) 1. g=(+) RoE < Ke (underperform business  target restructuring) 2. g=(+) RoE > Ke (investasi akan membuat perusahaan makin makmur) 4. g=(-) RoE > Ke 3. g=(-) RoE < Ke Suatu saat bisa asset bisa turun, sehingga kembali ke posisi (1)

Corporate Restructuring Motives Strengthening core business Achieving growth Increasing shareholders value

Typical Corporate Restructuring Process 1.Financial Restructuring (ini hanya nama, yg digunakan di Jepang. Kl di Canada namanya downsizing krn umumnya obesitas organisasi. Tujuannya: Stabilisasi) Goal: To stabilize company’s financial condition Method: Sell-off fixed assets Divest unprofitable Rationalize working capital

Conservative policy Moderate policy Aggressive policy Working Capital = Investment 0Sales

Typical Corporate Restructuring Process 2.Business Rebuilding (ini hanya nama, yg digunakan di Jepang. Kl di Canada namanya reengineering) Goal: To stenghten company’s core business Method: Cross functional Team Share exchanges Share Transfer

Contoh Share Exchanges αβαβ X1Y1 αβαβ New share Old share αβαβ Y1 X1

Contoh Share Transfer α X1 α Old share α X1 New Company New share New Company

Typical Corporate Restructuring Process 3.Value Building Growth Goal: To sustain long-term profitable growth Method: Balance Business Portfolio Proactive Divestiture

A A1 A2

Corporate Restructuring Obstacles Higher priority on security employment Difficulty to break internal politics Limited concern with shareholders value creation Lacks of strong leadership Shortage of capable outside experts Kadang yg keliru adalah: yg dipotong/ dikurangi orangnya, padahal yg salah investasinya

Bahan Ujian Ujian Kamis tgl 3 Des 2009 Mulai jam – menit – Political capital: Gov dealing with business – Seize Advantage – Flying Blind – Saving the business (turn around) – New Growth Platforms