1.

0 Background
Choose company from the industries and give background information on that company
and its function within the industry.

2.0 Introduction
Current Financial Crisis

• Trillions of dollars lost in stock declines.

• Investors fleeing markets.
• Historic investment banks closing doors.
• Hundreds of billions in government bailouts.
• Credit unavailable for borrowers in need.
• Fears of a new great depression.

(find references for the above)

3.0 Current status of the industry

Pharmaceutical
External drivers
• Major drug reimbursement issues
• Patent expiration/generic competition
• Market for corporate control
• Financing agency issues
• Government pressure

Internal drivers
• Economies of scale (strength)
• Sales growth issues/global expansion (strength)
• Asset acquisition (strength)
• Direct to Consumer (DTC) campaigns
• R&D pipeline gaps/R&D synergies (strength)
• Management greed/agency factors
• Biotechnology/Gene mapping

Current status of Telecom Industry

External drivers
• Too many players- profit is dependent on number of players in the market.
• Small players with no overheads.
• Deregulation
• Market share
 • Price competition
• Economies of scale (strength)
• Demand for cheaper technology

Internal drivers
• Technology
• Voice Over Internet Protocol – low prices.
• Churn/attrition rate
• Increase in capital expenditure to deliver services (weakness)
• Return On Investment not assured (weakness)

Current status of financial industry

External drivers
• Deregulation
• Globalization- the removing of restrictions on branches i.e. where a bank
could locate. As market-oriented economies continue to break down trade barriers
and adopt policies that attract investors, more firms will seek opportunities to expand
by partnering and aligning themselves with established companies
• Competition
• Lack of confidence by investors

Internal drivers
• Technology
• Lower communication cost
• Economies of scale (strength)

Current status of Airline Industry

Deregulation
Cost structure
Substitutes (shipping industry)

This is generic

Current status of Industry competitiveness

• Factor conditions i.e factors of production pg 231-232

• Demand conditions- home market demand for the industry

 • Related and supporting industries – suppliers/industries that are competitive

Internationally (that would support your goods and services

• Firm strategy, structure and rivalry. ) An example is Catalyst, a gas marketer in Georgia that had to

close down after Constellation/Lehman Brothers could no longer provide gas supply or financial

credit. Reliant is another example. Its credit lines, provided by Merrill Lynch, were closed after

Merrill Lynch was acquired by Bank of America.

Industry Structure

• Growth stage/Mature stage

• Diminishing returns

• highly capital-intensive, requiring large amounts of short-term borrowing to provide working capital
• Substantial equity and borrowing to build new infrastructure.
• New infrastructure investment.
• An economic downturn will likely result in falling sales coupled with rising interest rates.
• At the same time feeling significant pressure from regulators to hold down rate increases.

Financial crisis beginning to impact global mobile industry.

New research from Informa Telecoms & Media suggests that the ongoing financial crisis started to make an
impact on the global mobile telecommunications sector during the second half of 2008. Informa's view is that
the slowdown in the growth of global mobile subscription numbers and the device market is likely to accelerate
in 2009.

The world's mobile subscription market grew by 18.5% y-o-y in 2008 (down from 22.5% growth in 2007) and is
set to increase by just 12.7% this year, although Informa says it does note that this reduction in growth is partly
due to the effect of natural market development, particularly in Western Europe and USA.

Of more concern to the industry, is the 7% fall estimated by Informa in the handset replacement market in
2008. Unsurprisingly, the world's developed markets will be hit especially hard with the total device market in
Western Europe set to contract by 13% in 2009, and it could take as long as three years for the device market
to get back to 2008 sales levels.

"The handset market is facing a difficult period with the average replacement cycle likely to increase by 6-8
months in 2009, which would result in a 5% y-o-y decline in the number of total devices sold globally to
1.16bn",. "And things could get even worse than this, as depending on the extent of the deterioration of global
macroeconomic conditions, the y-o-y fall in the number of total devices sold could double to 10% with
replacement cycles increasing to up to 12 months."
Models
Discussion on and analysis of Porters five forces

SWOT
PEST analysis of the industry

Evolution of the Industry (where will it go from there)

• This depends on which stage it’s at.

o Maintain market
o Exit the market
o Reverse positioning
o Consolidation
o Breakaway positioning
o Harvesting

Analysis of The firm competiveness

• SWOT
o Core competencies
o Creating strong brands
o Being innovative
o Leadership
o Teamwork
o Value chain management (theory)

Future strategic direction of the firm

• Backward integration
• Forward integration
• Maintaining good leadership
• Quality
• Differentiation strategies vs. low cost
• Focus strategy (niche)
• Joint ventures
• Merger/acquisition
• Turnaround Strategies (pg 183)
o Asset cost surgery
o Selective product and market pruning
o Piecemeal productivity improvements