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Flevy Management Insights Case Study
Aerospace Market Entry Strategy for Commercial Satellite Firm

There are countless scenarios that require Corporate Strategy. Fortune 500 companies typically bring on global consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture, or boutique consulting firms specializing in Corporate Strategy to thoroughly analyze their unique business challenges and competitive situations. These firms provide strategic recommendations based on consulting frameworks, subject matter expertise, benchmark data, best practices, and other tools developed from past client work. Let us analyze the following scenario.

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Consider this scenario: The organization is a commercial satellite company in the aerospace industry, facing challenges in expanding its market share.

Despite having advanced technology and a skilled workforce, the company has struggled to penetrate new markets and increase its competitiveness. The organization is seeking to refine its Corporate Strategy to identify new growth opportunities and to enhance its market positioning in a highly competitive and regulated space.

In reviewing the organization's situation, initial hypotheses might include a lack of clear market differentiation, insufficient understanding of customer needs in new markets, or a misalignment between the organization's capabilities and market opportunities. These hypotheses will guide the initial phase of the strategic review.

Strategic Analysis and Execution Methodology

The organization's path to a robust Corporate Strategy can be effectively structured through a 5-phase consulting methodology. This established process not only aids in thorough analysis but also in seamless execution, which can result in sustainable competitive advantage and market growth.

  1. Market Assessment and Competitive Analysis: Identify key market trends, assess competitor strategies, and understand regulatory environments. Questions to explore include "What are the unmet needs of the target market?" and "How do competitors meet these needs?" Key activities involve data collection, stakeholder interviews, and benchmarking.
  2. Capability Gap Analysis: Evaluate the organization's internal capabilities against market requirements. This includes reviewing technological assets, organizational structure, and skillsets. Potential insights may reveal areas for operational improvement or innovation.
  3. Strategic Option Development: Brainstorm and evaluate different market entry strategies. This phase involves creative workshops, scenario planning, and financial modeling to predict outcomes of various strategies.
  4. Implementation Roadmap Creation: Develop a detailed plan of action, including timelines, resource allocation, and change management strategies. Common challenges include ensuring cross-departmental alignment and securing buy-in from key stakeholders.
  5. Performance Monitoring and Adjustment: Establish metrics for success and create a feedback loop to refine the strategy over time. This phase includes setting up dashboards, regular review meetings, and a process for iterative improvements.

Learn more about Change Management Competitive Advantage Corporate Strategy

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Corporate Strategy Implementation Challenges & Considerations

When adopting a new market strategy, questions often arise regarding the integration of this strategy with existing operations. It is crucial to maintain alignment with the organization's core values and capabilities while pursuing new market opportunities. Strategic realignment can also necessitate cultural shifts within the organization, which must be managed carefully to ensure a smooth transition.

Anticipated business outcomes include increased market share, revenue growth, and a stronger competitive position. By following the methodology, firms can expect to see a 20-30% increase in market penetration within the first year post-implementation.

Potential implementation challenges could include resistance to change from within the organization and unforeseen market shifts. It is essential to maintain agile management practices to navigate these challenges effectively.

Learn more about Agile Revenue Growth

Corporate Strategy KPIs

KPIS are crucial throughout the implementation process. They provide quantifiable checkpoints to validate the alignment of operational activities with our strategic goals, ensuring that execution is not just activity-driven, but results-oriented. Further, these KPIs act as early indicators of progress or deviation, enabling agile decision-making and course correction if needed.

You can't control what you can't measure.
     – Tom DeMarco

  • Market Share Growth: to measure the effectiveness of the market entry strategy.
  • Revenue Growth Rate: to track financial performance and return on investment.
  • Customer Acquisition Cost: to understand the efficiency of marketing efforts.
  • Employee Engagement Scores: to gauge internal acceptance and alignment with the new strategy.

For more KPIs, take a look at the Flevy KPI Library, one of the most comprehensive databases of KPIs available. Having a centralized library of KPIs saves you significant time and effort in researching and developing metrics, allowing you to focus more on analysis, implementation of strategies, and other more value-added activities.

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Implementation Insights

Throughout the implementation, it became evident that the organization's success was closely tied to its ability to respond rapidly to market feedback. Real-time data analytics played a crucial role in adjusting the strategy, as noted by a McKinsey report which highlights that data-driven organizations are 23% more likely to outperform competitors in terms of new customer acquisition.

Another insight was the importance of stakeholder engagement. Ensuring that all departments understood the strategic shift and were committed to its execution was paramount. This aligns with findings from the Project Management Institute, which indicate that projects with engaged executive sponsors are 40% more likely to succeed.

Learn more about Project Management Data Analytics

Corporate Strategy Deliverables

  • Market Analysis Report (PowerPoint)
  • Strategic Plan Framework (Word)
  • Financial Impact Model (Excel)
  • Risk Assessment Document (Word)
  • Implementation Playbook (PDF)

Explore more Corporate Strategy deliverables

Corporate Strategy Best Practices

To improve the effectiveness of implementation, we can leverage best practice documents in Corporate Strategy. These resources below were developed by management consulting firms and Corporate Strategy subject matter experts.

Corporate Strategy Case Studies

One notable case study is from a global satellite communications provider that successfully entered the maritime communications market. By following a similar strategic methodology, the company was able to leverage its existing technology infrastructure and realize a 35% growth in market share within two years.

Another case involves an aerospace manufacturer that diversified into the commercial drone space. The organization's meticulous market research and phased strategic approach resulted in a 50% increase in revenue from the new product line within the first 18 months .

Explore additional related case studies

Alignment with Core Business Objectives

Ensuring that the new market strategy aligns with the organization's core business objectives is critical. The strategic plan must reinforce the company's overarching goals and integrate with its long-term vision. This requires a careful balance between pursuing new opportunities and maintaining the strengths that have underpinned past successes.

According to BCG, companies that align their new initiatives with their core business can see a 14% higher rate of successful implementation compared to those that do not. Therefore, it is essential for the strategy development process to include checks and balances that ensure alignment with the core business objectives at each phase.

Learn more about Strategy Development

Managing Cultural Change

Addressing cultural change is as important as the strategy itself. A study by McKinsey found that 70% of change programs fail to achieve their goals, largely due to employee resistance and lack of management support. To mitigate this, it's vital to engage with employees early in the strategy development process, clearly communicating the reasons for change and the benefits it will bring.

Additionally, leadership must be prepared to lead by example and foster an environment that encourages adaptability. This involves providing the necessary training and support systems for employees to successfully navigate the changes. An effective change management plan is crucial to ensure that the organization's culture evolves in a way that supports the new strategy.

Adapting to Market Shifts

Market shifts can significantly impact a new market entry strategy. To remain agile, the organization must establish a framework for continuous environmental scanning and rapid response mechanisms. This enables the company to adapt its strategy in real-time to changing market conditions.

Accenture research underscores the importance of agility, noting that companies that react to market changes and adjust their strategies accordingly can achieve up to a 27% increase in revenue growth. Therefore, the strategic planning process should include the development of a robust market intelligence system to inform ongoing strategy adjustments.

Learn more about Strategic Planning Market Intelligence Market Entry

Measuring Success and Making Adjustments

The measurement of success and the subsequent adjustments to the strategy are pivotal. Key Performance Indicators (KPIs) must not only reflect financial metrics but also customer satisfaction, employee engagement, and innovation rates. These KPIs should be reviewed regularly, and the strategy should be refined based on these insights.

According to a study by KPMG, companies that actively manage and adapt their KPIs in response to strategic changes are 45% more likely to report successful strategy execution. The regular review of KPIs ensures that the strategy remains relevant and effective in achieving the desired outcomes.

Learn more about Employee Engagement Customer Satisfaction Strategy Execution

Additional Resources Relevant to Corporate Strategy

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Key Findings and Results

Here is a summary of the key results of this case study:

  • Increased market share by 25% within the first year post-implementation, exceeding the expected 20-30% growth.
  • Achieved a 15% revenue growth rate, slightly below the anticipated growth rate of 20%.
  • Reduced customer acquisition cost by 12%, indicating improved efficiency in marketing efforts.
  • Employee engagement scores increased by 20%, demonstrating internal acceptance and alignment with the new strategy.

The initiative has yielded significant successes, particularly in market share growth, which exceeded the expected range. The increased market share by 25% demonstrates the effectiveness of the market entry strategy and validates the thorough market assessment and competitive analysis conducted during the strategic analysis phase. However, the revenue growth rate fell slightly below the anticipated level, signaling a need for further evaluation of the financial modeling and scenario planning during the strategic option development phase. Additionally, while the reduction in customer acquisition cost reflects improved marketing efficiency, the results could have been further optimized. The increase in employee engagement scores indicates successful internal acceptance of the new strategy, reflecting effective change management. However, the organization could have further leveraged real-time data analytics to make rapid adjustments and enhance the strategy's performance. Moving forward, the organization should consider refining financial modeling and scenario planning to align revenue growth more closely with projections and intensify efforts to optimize customer acquisition cost reduction.

Building on the initiative's achievements, the organization should focus on refining financial modeling and scenario planning to align revenue growth more closely with projections. Additionally, efforts to optimize customer acquisition cost reduction should be intensified, leveraging real-time data analytics for rapid adjustments. Continuous monitoring and adaptation of KPIs will be essential to ensure the strategy remains relevant and effective in achieving the desired outcomes.

Source: Aerospace Market Entry Strategy for Commercial Satellite Firm, Flevy Management Insights, 2024

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