Comprehensive exam answer  The GDP and income level (which directly

1. Brief introduction about the company, the reflects on consumer spending power)
activities, problems, general situation, types of  The currency depreciation or appreciation
competition and the market  Wages level
2. Company vision: should be:  price elasticity of demand
 Think big.
 Broad in scope. 6.3 Social, Cultural, Demographic, and
 Time related 5 years or more. Environmental forces
3. Company mission: should cover the following  Number of marriages, divorces, births, and
items: deaths.
 Customer  Social security programs
 Products or services  Per capita Income
 Markets  Lifestyle
 Technology  Traffic congestion
 Philosophy  Trust in government
 Self-concept  Average level of education
 Concern for public image  Population changes by race, age, and sex
 Concern for employees  Air pollution
 Concern for survival, profitability,  size, structure, and regional distribution of the
growth. population
4. Conclusion about the company, what is  Cultural fear or freedom level
missed?, what are the weaknesses and  Cultural symbol (status)
strengths regarding vision and mission  What’s socially acceptable?
5. Segmental analysis: 6.4 Technological forces
 Internet availability and usage
 E-commerce
 The rate of development
 The presence of skilled persons
 Presence of technological capabilities.
6.5 Competitors
 The structure, bases and intensity of
competition.
 The existing major competitors and any
competitive advantage.
 The major strengths and relative position of
each competitor.
 The objectives, strategies and the level of
profitability of each competitors.
 The market share level
6. External factors analysis(PESTEL analysis) =
7. Porter's 5 forces model for competition
Opportunities and threats:
6.1 Political, Governmental, and Legal forces:
 Political stability,
 Government regulations & deregulations.
 Changes in tax laws.
 Level of government subsidies
 Country to other countries relationships
 Trading policies& Import-export regulations
 Political conditions in foreign countries
 Facilities for the entrance for new foreign
investment, THEN write conclusion and the market should be
 Size of government budgets attractive never say that the market is not attractive!
 The relations with other countries 8. Internal factors = Strengths and Weaknesses:
6.2 Economic forces
 Availability of credit and saving 8.1 First we should do ratio analysis as follows:
 Level of disposable income Current Current Assets / Current Liabilities
 Interest rates Ratio = (X times) each 1$ of current liabilities is
 Inflation rates covered by (……) $ of current assets
 Unemployment Current Assets – Inventory / Current
 Stock Market trend Liabilities
 Foreign countries’ economic conditions Quick (X times) It’s a measure of immediate
 Monetary policies Ratio paying ability. It should be > 1 to be a
 investment laws and regulations, good sign.
Fixed Total Sales / Fixed Assets
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 Assets each 1$ of fixed assets results in (…$)of
Turnover sales
Ratio it measures how efficiently the firm uses
its plant &equipments
Total Total Sales / Total Assets
Assets (…%) the creditors have supplied (…%) of
Ratio the firms total financing.
Total Total Liabilities / Total Assets
Debt to (%) It measure the percentage of funds
total provided by current liabilities and long
assets term debt and compared to industry %
Return Net Income / Average Total Assets
on
Assets
Ratio
(ROA) % vs. industry
Return Net Income / Average Owners' Equity
on
Equity
Ratio
(ROE) % vs. industry
Net Income / Total Sales
Profit Each 1$ of net sales results on average in
Margin (%) of net income. To be more realistic it’s
Ratio better to use

8.2 Strengths / Weaknesses analysis

Note : If it’s Service Omit the Manufacturing 9. Apply TOWS (First matching)
factors and add the Servqual :
Tangibles - physical facilities, equipment, staff
appearance, etc.
* Reliability - ability to perform service dependably
and accurately
* Responsiveness - willingness to help and
respond to customer need
* Assurance - ability of staff to inspire confidence
and trust
* Empathy - the extent to which caring 10. Apply BCG
individualized service is given

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 14. Recommended marketing
strategies

14.1 Porters generic strategies from customer

perspectives

11. Set Smart objectives: (SMART objective)

(Specific, Measurable, Achievable, Realistic,
Cost leadership: Competitive advantage is the
timed) examples Increase sales by 30% in
lowest price
the Egyptian market in 6 months
Diffrentiation: Competitve advantage is the high
brand equity
12. Strategic strategies possible for bankruptcy
Focus: competitive advantage comes from
are Defensive Strategies:when the company
specialization ‫التخصص‬
is defending its situation in the market.
Cost leadership vs. cost reduction: Cost reduction
12.1 Retrenchment or shrinkage or
(MB will not reduce the cost after doing high
reorganizational strategies:it means the
techniques)
company undergoes cutting costs or costs
Chinese are cost leaders now
reduction strategy or redundancy for some
Lamborgini = Focus diffrentiation (Specialized only
employees. Its objective is cost reduction.
in sport cars)
The motive behind this strategy is: the
Mercedes Benz = Diffrentiation (As it has different
company is acting as a weak competitor in
products)
a profitable business. If this strategy didn’t
work go for the next strategy.
14.2 Military strategies (Marketing warfare
12.2 Divesture or partial liquidation strategies:
strategies) : not used in bankruptcy in our
Sell off the unprofitable biz division that
opinion
could be behind the company's poor
performance and use its money to invest in
A. Defensive marketing welfare
other divisions. If it didn’t work move to the
Market leader “company level and not product level”:
third strategy.
highest market share with a significant gap vs. the
second
13. AnsoffMatrix :
Defensive, we have to defend my position against
competition
STRONG COMPETITIVE MOVES SHOULD
ALWAYS BE BLOCKED. (Proactive)
B.Offensive marketing welfare:
Offensive means that you are a new comer and
want to attack the market leaderin his weak points
C. Flanking marketing welfare
A GOOD FLANKING MOVE MUST BE MADE
INTO AN UNCONTESTED AREA.
14.
15.
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 TACTICAL SURPRISE OUGHT TO BE AN Level of Market Targeting Segment
IMPORTANT ELEMNT OF THE PLAN.  Mass (undifferentiated) marketing
THE PURSUIT IS AS CRITICAL AS THE ATTACK The same offer with the a advantage of
ITSELF economic of scale
d. GUERRILLA MARKETING WARFARE  Segment (differentiated) marketing
Hit and run by trading offices (small companies
Several segment with offer for each
FIND A SEGMENT OF THE MARKET SMALL
ENOUGH TO DEFEND.  Concentrated (niche) marketing
NO MATTER HOW SUCCESSFUL YOU BECOME, Target Singles with a single marketing mix
NEVER ACT LIKE THE LEADER.  Local marketing
BE PREPARED TO GET OUT AT A MOMENT’S Tailoring products for the local customer
NOTICE group needs
 Customization
14.3 Value positioning strategies (Kotler) (from Tailoring products for the small group of
both customer and competition perspectives) people or specific individuals needs.
More value for more money. (Premium position
brand)
Example: Mont Blanc, Gucci apparel, Haagen-
Dazs B-Positioning:
More value (options) for the Same money. Positioning
Example: Lexus automobile vs. BMW Begin by the differentiating the company’s
The Same value for Less money. marketing offer that will deliver more value
Example: Panasonic TV vs. Sony than the competitors thus gaining
Less value for Much Less money. (De-featuring) competitive advantage
Example: VCRs offering fewer features, 1. Choose a broad poisoning for the product
Chinese products  Become best at one of the three
More value for Less money (For retailing) value disciplines. (Operational
Example: Carrefour , Wal-Mart store
Excellence – Product Leadership
and Customer Intimancy)
14.4 value disciplines (what are the generic  Achieve an adequate performance
strategies followed by world class companies WCC) level in the other two disciplines.
 Keep improving one’s superior
In bankruptcy we can follow operational position in the chosen discipline so
excellence as a way to do a cost reduction as not to lose out to a competitor.
 Keep becoming more adequate in
the other two disciplines, since
competitors keep raising customers’
expectations about what is
adequate.
2. Choose a specific poisoning for the product
 Best quality
 Best performance
 Most reliable
 Most durable
 Safest
 Fastest
 Best value for the money
 Least expensive
 Most prestigious
 Best designed or styled
14.5 Marketing plan STP (Segmentation,  Easiest to use
targeting and Positioning)  Most convenient
3. Choose a value poisoning for the product
 More for More
 More for the Same
 The Same for Less
Koltler 08 chapter, 2nd term marketing  Less for Much Less
 More for Less
We can make a simple marketing
overview as follows: C-Brand or Product strategies
A- Selecting target segment:
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 1. Line extension: additional items in the same 4. Early cash recovery :
product under the same brand Used when:
Advantage:  Faced with problem of liquidity
 Saving cost  Belief that the product life is likely to
 Minimize risk in introducing new be short
products Can be delivered by:
Disadvantage:  Mass distribution
 Brand dilution  Rigorous credit control policy
 consumer confusion  Special offers
 Cannibalization on original product  Discount to trigger immediate sales
and prompt payment
2. brand extension: launching new product
under the same brand
Advantage: 5. Reflecting product differentiation :
Used when:
 Saving high advertising cost and
build brand name  Target different segments it
 Give new products instant different products
recognition and faster acceptance
Disadvantage:
E-Promotion strategies
 consumer confusion about the 1. Advertising
brand image and may loose its Used when:
positioning  Build up long term image
 may harm consumer attitude toward  Cost efficient in reaching
other product under the same geographically dispersed buyers
brand  Trigger quick sales
 Gives image of good value to the brand
3. multi branding: new brand name in the
same product
Advantage: 2. Sales promotion
Used when:
 establish different features
 Encourage trial or purchase
 appeal to different buying motives
Disadvantage:  Short run effect
 multi branding might gain only small  Boosting sagging sales
market share
3. Public relation
 need resources on building Used when:
different brands  Building up good corporate image
D-Pricing strategies  Heading off unfavorable rumors
1. Market penetraion: set low prices to ensure
high level of sales
used when: 4. Personal selling
 market is highly price sensitive Used when:
 low price simulate market growth  Making sales
 production and distribution cost fall  Building customer relations
with in accumulated production preference, conviction and solicit
experience action
 Build up buyers
2. Market skimming: initial prices are set high
and gradually reduced to capture greet 5. Direct and interative marketing
number of market segments Used when:
Used when:
 Targeted individual consumers
 sufficient number of buyers have a  Localized and customized used to
high current demand reach well defined target segments
 high price communicates the image
of superior product
F-Distribution strategies
3. Product quality leadership : relative prices 1. Identify major alternatives channels
are set at a premium Number of intermediary:
Used when:  Exclusive distribution
 brands perceived relative high  selective distribution
quality  intensive distribution

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 2. Evaluting alternatives channels
Based on:
 Channels cost
 Sales output
 Product complexity
3. Selecting channels
Based on:
 Years on business
 Growth record
 Financial strength
 Service reputation
15 Recommended HR strategies
Figure 1: Framework of cost-reduction stages
COST-REDUCTION STAGES
STAGE ONE: SHORT-RANGE COST ADJUSTMENTS
. whereby the current employer, the lending firm, lends
HR practices for short-range cost adjustments
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There are several HR practices that firms can adopt in
an effort to engage in preliminary cost reductions. Some
of the more popular approaches that have emerged are:
1. Hiring freeze
A hiring freeze constitutes a mild form of downsizing
and reduces labor costs in the short term. Some firms
continue to hire new employees while cutting jobs at the
same time. While this practice may make sense in
terms of supplying the firm with key personnel,
2. Mandatory vacation
Implementing mandatory vacation involves requiring
employees to use their accrued vacation days or
mandating that individuals take a number of unpaid
vacation days during a certain time period.
3. Reduced workweek
Firms sometimes resort to a reduced workweek. This
may translate into the reduction from 40 to 35 or fewer
hours and thereby reduce the short-term payroll
expenditures.
4. Cut in overtime pay
Reducing or abolishing overtime pay for employees can
be a potent technique for reducing operational costs in
the short term.
5. Salary reduction
Salary reduction has been a standard practice for firms
experiencing unexpected financial pressure. Whereas
salary reduction may mitigate financial concerns in the
short-run, extended salary reductions can affect
employee morale and loyalty.
6. Temporary facility shutdown
Temporary facility shutdowns occur when a work site
closes for a designated period of time, while some
administrative functions are still performed. A shutdown
allows employees to have time off without using their
vacation days.
7. Soliciting cost-reduction ideas from employees
Employees appreciate the opportunity to make a
positive impact on their workplace and environment.
Firms frequently solicit cost-reduction ideas from
employees who are often creative in producing cost-
reduction solutions. This HR practice has shown to be
most effective when employees are able to make
suggestions in the early stages of cost cutting.
Unfortunately, many executives still do not realize that
employees are the best source of cost-STAGE TWO:
MEDIUM-RANGE COST ADJUSTMENTS
HR practices for medium-range cost adjustments
Firms typically adopt several HR practices in an effort to
engage in secondary cost reductions:
1. Extended salary reductions
Extending salary reductions can be a method of choice
if an economic downturn exceeds 6 months. While
extended salary reductions can negatively affect
employee commitment and morale,
2. Voluntary sabbaticals
Voluntary sabbaticals, also called furloughs, allow
salaried employees to take voluntary leaves for a
designated period of time. Companies may offer
sabbaticals with considerably reduced pay or no pay at
all..
3. Employee lending
Employee lending is a modern-day HR practice
an employee to another employer firm for a set period
of time while continuing to pay salary and providing
 benefits. The borrowing firm, which can be a
competitor, in return, reimburses the lending company
for part or all of the salary. some
4. Exit incentives
this option entails offering employees incentives to
leave the firm in the form of optional severance or early
retirement. This strategy enables firms to better target
jobs and units in that it recognizes employees for their
service and helps retain the remaining employees.
SELECTING A DOWNSIZING STRATEGY
Determining an appropriate workforce management
strategy remains a vital task for firms. In order to select
a downsizing strategy effectively, aligning a firm’s cost-
cutting methods with the cost-reduction stage as
outlined in Figure 1 may prove to be a powerful method.
While there are many HR tools at an executive’s
disposal, each practice works most effectively when
implemented during its established time frame, or cost-
reduction stage. At the same time, the assumptions
underlying the framework (Figure 1) are somewhat
simplistic and probably do not capture the complexity of
corporate decision-making. According to Vernon (2003),
at least six factors affecting the selection of a
downsizing strategy need to be considered:
o time, or the expected duration of an economic
downturn)
o resources, such as cash resources at hand
o budget, namely the financial condition of the firm)
o corporate culture, for example, the institutional values
and anticipated effects of cost cutting
o demographics, the location of the firm/demographics of
employees the firm would like to retain or rehire
o labor market, specifically the state and condition of the
labour market! ‫) بتجيب العماله منين‬
These factors should be considered when selecting a
particular downsizing approach. For instance, if the
expected duration of an economic downturn is
prolonged (i.e., factor time) and, thus, the
This paper has demonstrated that the ability to correctly
forecast the cost-reduction phase assists a firm in
determining appropriate employment strategies.
Some Suggestions to Fight Bankruptcy
Find more cash.
This may sound like a statement of the obvious:
If cash was plentiful, the business wouldn’t be
failing. But Rudnicki points out that without the
minimum amount of capital needed to stay
afloat, efforts to recharge the business will
prove futile. “Without [enough money], you’ll
likely be so overwhelmed that you won’t be able
to identify and address the root causes [of the
problem],” he says. In the early stages of
struggling, you might be able to borrow the
money or convince investors to step up. Or,
Rudnicki adds, it’s more likely that “to be
successful you’ll have to liquidate some non-
core part of the business or squeeze cash out
through tighter management of the balance
sheet.”
Make a management change.
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A struggling business probably needs new
people and new ideas to evolve. “All of us are
creatures of habit to at least some extent,”
Rudnicki notes. “For the turnaround to be
successful, there will need to be a change in
management, or at least a willingness to truly
admit that business-as-usual cannot continue.”
This can require honest and sometimes tough
decisions, but without the right people in place
the chances for improvement are markedly
lower.
Hire a consultant.
Real change can be difficult, especially when
the management team is “me, myself, and I.”
Consider hiring a consultant who specializes in
revitalizing failing businesses. As a starting
point, Rudnicki recommends the Turnaround
Management Association, which certifies
experts in the field (like Rudnicki). An outside
expert with a fresh perspective can help solve a
viable business’s problems without necessarily
requiring the owner to hire a new management
team.
Consider an Assignment for the Benefit of
Creditors.
“Some businesses fail because they no longer
serve a purpose for a large enough customer
base, so there’s really no reason to invest the
time and energy trying to develop and
implement a turnaround plan,” Rudnicki says.
“It’s simply better to liquidate them and move
on to a more beneficial endeavor.” In that case,
there are out-of-court alternatives to
bankruptcy. Rudnicki points to the Assignment
for the Benefit of Creditors, or ABC, as an
example. ABCs vary by state, but ultimately
they represent a liquidation process that the
American Bar Association [PDF] says is
“structured to save time and expense in
concluding the affairs of an insolvent company.”
In Rudnicki’s home state of Illinois, “going
through an ABC has been shown time and
again to be a cheaper and faster alternative to
a Chapter 7 [filing], resulting in a larger
distribution to creditors,” he says.
Selling Some of Your Assets
Sell whatever you can spare and use the
money to pay off your debts. Take action
immediately when you notice you can't afford
make payments anymore. If you wait until
you're behind on payments, it may be too late.
You can sell your furniture, jewelry, and
electronics on eBay, Craigslist, even in your
front yard. Is this a radical way to avoid
bankruptcy? Perhaps. Many people can't get
past the inconvenience of living without their
things, but you can adjust and it's only
temporary. It will help you avoid bankruptcy and
spare your credit.
 Pay Your Way Out of Debt Settle With Creditors and Debt Collectors

Can you afford to pay off your debts over a
period of time? You'd have to if you file Chapter
13 bankruptcy either to save an asset or
because you failed the means test for Chapter
7. If you take a closer look at your budget, you
may be able to cut out those nice-to-haves like
cable or satellite television, landline and cell
phones. These are examples of some
expenses you can cut without too much pain.
If you're already living on a bareboned-budget,
how about increasing your income by working
overtime or part-time? Hobbies and skills can
also help you get some extra money to avoid
bankruptcy.
Debt settlement is another of those things that
should be avoided under normal
circumstances. However, the brink of
bankruptcy isn't normal. If you have to choose
between settling a few debts or filing
bankruptcy, settle the debts, but do it right.
First, don't use a debt settlement company. Too
much time and extra money goes into these
companies than is necessary. Second, don't
settle any debt that is current. Instead, focus on
debts that have already been charged off or
sent to collection. Finally, be ready to pay as
soon as an agreement has been made.

Ask Creditors to Help You Avoid Bankruptcy

Your creditors would rather get some money

from you than no money at all. Let your
creditors know you are having financial difficulty
and want to avoid bankruptcy. Express your
willingness to pay the debt and ask if they can
help ease the burden by lowering your monthly
payment or decreasing your interest rate (or
both). Many credit card companies and banks
have hardship programs intended for this type
of situation.
Before you enter a hardship program make
sure your monthly payment and interest rate
actually go down. Otherwise, you could be
stuck with an even higher minimum payment.

Seek Consumer Credit Counseling

If you don't have luck working with your

creditors on your own, enlist the help of a
professional. Find a consumer credit counselor
who has experience working with creditors to
get your payment and interest rate reduced.
The new bankruptcy law requires credit
counseling prior to bankruptcy filings anyway so
it's worth it to strongly consider credit
counseling as a bankruptcy alternative. The
debt management plan payments may seem
out of reach, but if you look, you may find holes
in your budget that allow you to make the
payments.

Get Help From Family and Friends

Normally, borrowing money from family and

friends is a bad idea. It's been known to create
hardships and even end relationships. But
there's an exception to every rule, and
bankruptcy is one. Take the time to calculate
how much money you need to avoid
bankruptcy. Take a hard look at what you're
able to contribute, then ask friends and family
to help you make up the difference. Before you
approach them with your wallets turned out,
come up with a plan for how you will repay
them once your financial situation has turned
around.

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