Flevy Management Insights Case Study
Digital Transformation and Product Launch Strategy for Telehealth Company


Fortune 500 companies typically bring on global consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture, or boutique consulting firms specializing in Product Launch 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, KPIs, best practices, and other tools developed from past client work. We followed this management consulting approach for this case study.

TLDR A mid-size ambulatory healthcare provider struggled with declining patient retention and rising costs while launching a telehealth product. The launch achieved a 15% increase in retention and a 20% reduction in costs, underscoring the value of Digital Transformation and Operational Excellence in enhancing service delivery and patient satisfaction.

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Consider this scenario: A mid-size ambulatory health care services provider faces strategic challenges in implementing a product launch strategy for telehealth services.

The organization is experiencing internal inefficiencies and external competitive pressures, leading to a 20% decline in patient retention rates and operational costs exceeding budget by 15%. The primary strategic objective is to enhance its market presence through digital transformation and operational efficiency.



This organization is a mid-size ambulatory health care services provider encountering significant operational inefficiencies and competitive pressures. The issues stem from outdated technology infrastructure and a lack of digital capabilities, which are critical in the current healthcare landscape. Additionally, the rise in telehealth adoption by competitors has left this organization lagging behind. The immediate focus is to implement a digital transformation strategy to modernize operations and enhance patient care.

Environmental Assessment

The ambulatory health care services industry is currently undergoing a significant shift towards digital health solutions, driven by patient demand for convenience and cost-efficiency. We begin our analysis by analyzing the primary forces driving the industry.
  • Internal Rivalry: High due to numerous providers offering similar services within close geographical proximity.
  • Supplier Power: Moderate as medical device and software suppliers have specialized offerings but face competitive pressures themselves.
  • Buyer Power: High given patients' ability to easily switch providers, especially with the rise of telehealth options.
  • Threat of New Entrants: Moderate, with telehealth platforms lowering barriers to entry but still requiring regulatory compliance and significant investment.
  • Threat of Substitutes: High as traditional in-person visits are increasingly replaced by telehealth and other digital health solutions.
Emergent trends suggest a growing preference for telehealth and remote patient monitoring. Based on these trends, several major changes in industry dynamics are observed:
  • Shift towards telehealth: Opportunity to introduce telehealth services, but risk of initial investment costs and patient adoption lag.
  • Increased regulatory scrutiny: Opportunity to build compliance as a competitive advantage, with the risk of potential fines and operational disruptions.
  • Patient-centric care models: Opportunity to enhance patient experience and loyalty, though it requires significant changes in service delivery models.
  • Data security concerns: Opportunity to lead in cybersecurity measures, with risks related to data breaches and patient trust.
The PEST analysis reveals that politically, healthcare regulations are tightening. Economically, there's pressure to reduce costs. Socially, patient demand for convenience is rising. Technologically, rapid advancements in telehealth and digital health solutions are transforming the industry landscape.

For a deeper analysis, take a look at these Environmental Assessment best practices:

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Internal Assessment

The organization has strong clinical expertise and a dedicated workforce but struggles with outdated technology and operational inefficiencies.

SWOT Analysis

Strengths include a well-established brand and strong clinical expertise. Opportunities lie in digital health adoption and telehealth service expansion. Weaknesses are operational inefficiencies and outdated technology. Threats include rising competition and stringent regulatory requirements.

JTBD Analysis

Patients need convenient, accessible, and efficient care solutions. The organization's current offerings fall short in digital capabilities, leading to patient dissatisfaction and attrition. Addressing this requires a robust digital transformation to meet patient needs effectively.

Organizational Design Analysis

The current hierarchical structure limits agility and slows decision-making. A more decentralized model could empower frontline staff, fostering innovation and faster service improvements. This shift would align operational processes with patient-centric goals, enhancing overall service delivery and patient satisfaction.

Strategic Initiatives

Based on the comprehensive understanding gained from the previous industry analysis and internal capability assessment, the leadership team formulated strategic initiatives over a 3-year horizon.
  • Telehealth Service Launch: Develop and launch a comprehensive telehealth platform to enhance patient access and care. This initiative aims to increase patient retention by 15% and attract new demographics. Value creation stems from reduced operational costs and expanded market reach. Requires investment in telehealth technology, training, and marketing.
  • Operational Efficiency Improvement: Streamline operational processes through digital tools and automation. Goals include reducing operational costs by 20% and improving patient throughput. Value creation from cost savings and improved service quality. Requires CapEx in technology and training for staff.
  • Data Security Enhancement: Implement advanced cybersecurity measures to protect patient data. Goals include achieving full compliance with regulatory standards and enhancing patient trust. Value creation from risk mitigation and improved reputational standing. Requires investment in cybersecurity infrastructure and continuous monitoring.
  • Patient Engagement Platform: Develop a digital patient engagement platform to improve communication and care coordination. Goals include increasing patient satisfaction scores by 25% and reducing no-show rates. Value creation through enhanced patient loyalty and operational efficiency. Requires investment in software development and patient education initiatives.
  • Market Research and Analytics: Conduct thorough market research to identify emerging trends and patient needs. Goals include informed strategic decisions and tailored service offerings. Value creation from data-driven insights and competitive positioning. Requires investment in analytics tools and market research teams.
  • Partnership with Technology Providers: Establish partnerships with leading technology providers to enhance service offerings and stay ahead of technological advancements. Goals include continuous innovation and improved service delivery. Value creation through access to cutting-edge technologies and shared expertise. Requires negotiation and collaboration with tech partners.
  • Employee Training and Development: Implement comprehensive training programs to upskill employees in digital health tools and patient care. Goals include increasing staff competency and job satisfaction. Value creation from enhanced service quality and employee retention. Requires investment in training resources and continuous learning platforms.
  • Regulatory Compliance Strategy: Develop a robust strategy to ensure compliance with evolving healthcare regulations. Goals include avoiding fines and operational disruptions. Value creation from risk mitigation and operational stability. Requires investment in compliance tools and expert consultations.

Product Launch Strategy Implementation 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.


What gets measured gets managed.
     – Peter Drucker

  • Patient Retention Rate: Measures the effectiveness of telehealth and patient engagement initiatives.
  • Operational Cost Reduction: Tracks the success of efficiency improvement measures.
  • Patient Satisfaction Score: Gauges the impact of enhanced digital and patient-centric services.
  • Data Breach Incidents: Monitors the effectiveness of cybersecurity measures.
  • Employee Training Completion Rate: Assesses the reach and impact of training programs.
These KPIs provide insights into the effectiveness of strategic initiatives, guiding adjustments and ensuring alignment with organizational goals.

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Stakeholder Management

Critical stakeholders include management, frontline staff, technology partners, and patients.
  • Management: Responsible for strategic decision-making and resource allocation.
  • Frontline Staff: Implementers of new digital tools and patient care practices.
  • Technology Partners: Provide necessary digital and cybersecurity solutions.
  • Patients: End-users of telehealth and engagement platforms.
  • Regulatory Bodies: Oversee compliance with healthcare regulations.
  • Investors: Financial backers of technology and operational improvements.
Stakeholder GroupsRACI
Management
Frontline Staff
Technology Partners
Patients
Regulatory Bodies
Investors

We've only identified the primary stakeholder groups above. There are also participants and groups involved for various activities in each of the strategic initiatives.

Learn more about Stakeholder Management Change Management Focus Interviewing Workshops Supplier Management

Product Launch Strategy Deliverables

These are a selection of deliverables across all the strategic initiatives.

  • Digital Transformation Strategy Framework (PPT)
  • Telehealth Service Launch Plan (PPT)
  • Operational Efficiency Improvement Roadmap (PPT)
  • Data Security Guidelines (PPT)
  • Market Research Report (Excel)

Explore more Product Launch Strategy deliverables

Telehealth Service Launch

The implementation team utilized the Value Chain Analysis framework to identify and optimize activities that would create the most value in the telehealth service launch. This framework was useful because it allowed the organization to break down its operations into primary and support activities, highlighting areas where efficiencies could be gained and value could be added. The team followed this process:

  • Identified primary activities such as inbound logistics, operations, outbound logistics, marketing and sales, and service.
  • Analyzed support activities including firm infrastructure, human resource management, technology development, and procurement.
  • Mapped out each activity and assessed its current state versus desired state in the context of telehealth service delivery.
  • Identified gaps and areas for improvement, focusing on technology integration and training for staff to ensure seamless telehealth consultations.

Additionally, the team employed the Business Model Canvas to visualize and design the telehealth service business model. This framework was beneficial as it provided a comprehensive view of the business, encompassing key partners, activities, resources, value propositions, customer relationships, channels, customer segments, cost structure, and revenue streams. The team followed this process:

  • Defined the value proposition for telehealth services, emphasizing convenience, accessibility, and cost-effectiveness.
  • Identified key partners, including technology providers and healthcare professionals, to support the telehealth service.
  • Outlined key activities required to launch and sustain the telehealth service, such as platform development, marketing, and customer support.
  • Mapped out customer segments and tailored the service offering to meet the specific needs of each segment.
  • Developed a cost structure and revenue model to ensure financial viability and sustainability of the telehealth service.

The implementation of these frameworks resulted in a streamlined telehealth service launch, with optimized processes and a clear business model. This led to a 15% increase in patient retention and a significant reduction in operational costs.

Product Launch Strategy Best Practices

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

Operational Efficiency Improvement

The implementation team employed the Lean Six Sigma framework to enhance operational efficiency. Lean Six Sigma was particularly useful because it focuses on reducing waste and improving process quality by combining lean manufacturing principles with Six Sigma methodologies. The team followed this process:

  • Defined the scope of the efficiency improvement project, focusing on key operational processes.
  • Measured current process performance using data collection and analysis tools.
  • Analyzed data to identify root causes of inefficiencies and areas of waste.
  • Implemented process improvements using lean tools such as value stream mapping and Six Sigma techniques like DMAIC (Define, Measure, Analyze, Improve, Control).
  • Controlled the improved processes through continuous monitoring and feedback loops to ensure sustained efficiency gains.

In addition, the team utilized the Theory of Constraints (TOC) to identify and address bottlenecks in the operational processes. TOC was useful because it focuses on identifying the most critical limiting factor (constraint) that hinders performance and systematically improving it. The team followed this process:

  • Identified the primary constraint in the operational process that was causing delays and inefficiencies.
  • Exploited the constraint by optimizing its performance and ensuring it was fully utilized.
  • Subordinated other processes to support the optimal performance of the constraint.
  • Elevated the constraint by making necessary investments or changes to eliminate it as a limiting factor.
  • Repeated the process to identify and address new constraints as they emerged.

The implementation of these frameworks resulted in a 20% reduction in operational costs and improved patient throughput, enhancing overall service quality and efficiency.

Data Security Enhancement

The implementation team used the NIST Cybersecurity Framework to enhance data security. This framework was valuable because it provides a comprehensive set of guidelines and best practices for managing cybersecurity risks. The team followed this process:

  • Identified critical assets and data that required protection.
  • Developed a detailed risk assessment to understand potential threats and vulnerabilities.
  • Implemented protective measures based on the framework's core functions: Identify, Protect, Detect, Respond, and Recover.
  • Conducted regular training and awareness programs for employees to ensure adherence to security protocols.
  • Established continuous monitoring and incident response plans to quickly address any security breaches.

Moreover, the team adopted the Zero Trust Security Model to further strengthen data security. This model was useful as it operates on the principle of "never trust, always verify," ensuring robust access controls and continuous verification of user identities. The team followed this process:

  • Implemented strict access controls, requiring multi-factor authentication for all users.
  • Segregated network resources to limit access based on user roles and responsibilities.
  • Continuously monitored user activities and network traffic to detect and respond to anomalies.
  • Regularly updated security policies and procedures to adapt to evolving threats.

The implementation of these frameworks resulted in enhanced data security, with no reported data breaches and increased patient trust, leading to improved reputational standing.

Patient Engagement Platform

The implementation team utilized the Customer Journey Mapping framework to design the patient engagement platform. This framework was useful because it provided a visual representation of the patient's interactions with the organization, identifying pain points and opportunities for improvement. The team followed this process:

  • Mapped out the entire patient journey, from initial contact to post-care follow-up.
  • Identified key touchpoints and interactions where engagement could be enhanced.
  • Analyzed patient feedback and data to understand pain points and areas for improvement.
  • Designed solutions to address identified pain points and enhance overall patient experience.
  • Implemented the patient engagement platform with features tailored to different touchpoints in the patient journey.

Additionally, the team employed the Service Blueprinting framework to detail the patient engagement platform's service processes. This framework was beneficial as it provided a comprehensive view of frontstage and backstage activities, ensuring alignment between patient-facing services and internal processes. The team followed this process:

  • Created a detailed service blueprint outlining all patient-facing and internal processes involved in the engagement platform.
  • Identified key interactions and support processes required to deliver a seamless patient experience.
  • Aligned internal processes and resources to support the patient engagement platform effectively.
  • Implemented continuous feedback loops to monitor and improve the platform based on patient feedback.

The implementation of these frameworks resulted in a 25% increase in patient satisfaction scores and a reduction in no-show rates, enhancing overall patient loyalty and engagement.

Market Research and Analytics

The implementation team leveraged the Five Whys Analysis to identify underlying issues and opportunities in the market research process. This framework was useful because it helped in drilling down to the root causes of observed market trends and patient needs. The team followed this process:

  • Identified key market trends and patient needs that required further investigation.
  • Applied the Five Whys technique to each identified issue, asking "why" repeatedly until the root cause was uncovered.
  • Documented findings and insights to inform strategic decisions and service offerings.

Furthermore, the team utilized the Delphi Method to gather expert opinions and achieve consensus on market trends and strategic directions. This framework was beneficial as it facilitated structured communication among experts, leading to well-informed and reliable market insights. The team followed this process:

  • Selected a panel of industry experts and stakeholders to participate in the Delphi process.
  • Conducted multiple rounds of surveys, collecting and refining expert opinions on market trends and patient needs.
  • Analyzed survey results to identify common themes and areas of consensus.
  • Incorporated expert insights into the market research report and strategic planning.

The implementation of these frameworks resulted in actionable market insights, enabling the organization to tailor its service offerings to meet emerging patient needs and stay ahead of industry trends.

Partnership with Technology Providers

The implementation team employed the Strategic Alliance Framework to establish partnerships with leading technology providers. This framework was useful because it provided a structured approach to identifying, negotiating, and managing strategic alliances. The team followed this process:

  • Identified potential technology providers that aligned with the organization's strategic goals and needs.
  • Conducted due diligence to assess the capabilities and compatibility of potential partners.
  • Negotiated partnership agreements, defining roles, responsibilities, and expectations.
  • Established governance structures to manage and monitor the partnerships effectively.
  • Implemented regular performance reviews and feedback mechanisms to ensure continuous improvement and alignment.

Additionally, the team utilized the Value Network Analysis to map and understand the relationships and value exchanges within the partnership ecosystem. This framework was beneficial as it provided a comprehensive view of how value was created, exchanged, and captured among partners. The team followed this process:

  • Mapped out the entire value network, identifying all key players and their roles.
  • Analyzed value exchanges between the organization and its technology partners.
  • Identified opportunities to enhance value creation and capture within the network.
  • Optimized collaboration and communication channels to ensure seamless value exchange.

The implementation of these frameworks resulted in strong, mutually beneficial partnerships with technology providers, enabling continuous innovation and improved service delivery.

Employee Training and Development

The implementation team utilized the Kirkpatrick Model to evaluate the effectiveness of employee training programs. This framework was useful because it provided a comprehensive approach to measuring training outcomes at four levels: reaction, learning, behavior, and results. The team followed this process:

  • Assessed employee reactions to training programs through surveys and feedback forms.
  • Measured learning outcomes using pre- and post-training assessments.
  • Observed changes in employee behavior and performance on the job.
  • Evaluated overall results in terms of improved service quality and operational efficiency.

Additionally, the team employed the ADDIE Model (Analysis, Design, Development, Implementation, Evaluation) to design and implement the training programs. This framework was beneficial as it provided a systematic approach to developing effective training solutions. The team followed this process:

  • Conducted a needs analysis to identify skill gaps and training requirements.
  • Designed training programs tailored to address identified needs and objectives.
  • Developed training materials and resources to support the programs.
  • Implemented the training programs, ensuring employee participation and engagement.
  • Evaluated the effectiveness of the programs using the Kirkpatrick Model.

The implementation of these frameworks resulted in increased staff competency and job satisfaction, leading to enhanced service quality and employee retention.

Regulatory Compliance Strategy

The implementation team utilized the COSO Framework (Committee of Sponsoring Organizations of the Treadway Commission) to develop a robust regulatory compliance strategy. This framework was useful because it provided a comprehensive approach to internal control and risk management, ensuring compliance with regulatory standards. The team followed this process:

  • Established control environment by setting the tone at the top and promoting a culture of compliance.
  • Conducted risk assessments to identify and evaluate compliance risks.
  • Implemented control activities to mitigate identified risks and ensure adherence to regulatory requirements.
  • Developed information and communication channels to keep all stakeholders informed about compliance policies and procedures.
  • Established monitoring mechanisms to continuously assess the effectiveness of compliance controls.

Additionally, the team employed the RACI Matrix to clarify roles and responsibilities in the compliance process. This framework was beneficial as it provided a clear structure for accountability and decision-making. The team followed this process:

  • Identified key compliance activities and processes.
  • Assigned roles and responsibilities using the RACI (Responsible, Accountable, Consulted, Informed) model.
  • Communicated the RACI matrix to all stakeholders to ensure clarity and alignment.
  • Monitored and reviewed the RACI matrix regularly to ensure its effectiveness.

The implementation of these frameworks resulted in a robust compliance strategy, minimizing regulatory risks and ensuring operational stability.

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Key Findings and Results

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

  • Increased patient retention by 15% through the successful launch of a comprehensive telehealth platform.
  • Reduced operational costs by 20% via the implementation of Lean Six Sigma and Theory of Constraints methodologies.
  • Achieved a 25% increase in patient satisfaction scores with the deployment of a digital patient engagement platform.
  • Enhanced data security with zero reported data breaches, leading to improved patient trust and reputational standing.
  • Established strong partnerships with technology providers, fostering continuous innovation and improved service delivery.
  • Increased staff competency and job satisfaction through comprehensive training programs, resulting in higher employee retention.
  • Developed a robust regulatory compliance strategy, ensuring full adherence to evolving healthcare regulations and minimizing risks.

The overall results of the initiative indicate a significant positive impact on both operational efficiency and patient satisfaction. The telehealth service launch and patient engagement platform directly contributed to a 15% increase in patient retention and a 25% boost in satisfaction scores, demonstrating the effectiveness of the digital transformation strategy. Additionally, the 20% reduction in operational costs highlights the success of Lean Six Sigma and Theory of Constraints methodologies in streamlining processes. However, some areas, such as initial patient adoption of telehealth services, were slower than expected, suggesting a need for more robust patient education and marketing efforts. The lack of data breaches and enhanced cybersecurity measures were critical in maintaining patient trust, but continuous vigilance is necessary to adapt to evolving threats. Alternative strategies, such as more aggressive marketing campaigns and additional patient support resources, could have accelerated telehealth adoption and further improved outcomes.

Moving forward, it is recommended to focus on continuous improvement and scaling of the telehealth services to capture a larger market share. Enhancing patient education and marketing efforts will be crucial in driving higher adoption rates. Additionally, maintaining and updating cybersecurity measures will be essential to safeguard patient data and trust. Expanding partnerships with technology providers can further drive innovation and service quality. Lastly, ongoing training and development programs for staff will ensure sustained operational efficiency and high-quality patient care.

Source: Digital Transformation and Product Launch Strategy for Telehealth Company, Flevy Management Insights, 2024

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