Building Your Analysis

When we begin our analysis, it's essential to focus on building support for your proposed solution while also understanding the reasons against the alternatives. To effectively do this, the first step is to gain a comprehensive understanding of the company, including what business it is truly in and what it aims to accomplish.

Take McDonald's, for example. While it may appear to be a fast-food company, it is fundamentally in the real estate business. Its franchisees operate within the quick-service restaurant sector, but McDonald's profits primarily from finding and securing properties where these franchises can sell hamburgers.

Another example is Stars Air Ambulance, a helicopter rescue service located in Alberta. When discussing this organisation with students, many mistakenly categorise it as part of the healthcare or transportation industries. In reality, its core business is about saving lives. This perspective directly influences how the company generates income, particularly through fundraising, as it is a charitable organisation reliant on donations from individuals who understand the value of their service in critical moments.

In conducting this analysis, it's crucial to leverage various tools. These tools include factual information from the case, existing knowledge about the company, and a focus on identifying key issues and problems that require resolution. The goal is to build context, pinpoint issues, and explore alternatives while supporting your chosen solution and discrediting the alternatives you won't pursue.

To aid in this process, employ analytical frameworks such as SWOT (Strengths, Weaknesses, Opportunities, Threats), PESTLE (Political, Economic, Social, Technological, Legal, Environmental), Value Chain analysis, and Porter’s Five Forces. These tools will guide you in identifying issues and generating insights that will help you build a solid context for your analysis.

Furthermore, it's critical to approach this from both an internal and external perspective. Internally, you should uncover core competencies, assess organisational culture, and analyse strengths and weaknesses via SWOT analysis. Externally, you'll want to explore the competitive landscape, stakeholder concerns, and identify opportunities and threats. This external assessment will inform your understanding through competitive landscape maps and stakeholder analysis.

Ultimately, you need to synthesise all this information into a financial analysis that examines the financial impact of your proposed solution. You should evaluate expected changes in revenue, costs, and most importantly, profit, as your findings will likely be presented to a CEO interested in maximising shareholder value. Ensure that your proposed changes are significant enough to capture the interest of your audience.

In terms of tools for financial analysis, use ratio analysis for financial statements, along with metrics like ROI (Return on Investment) and NPV (Net Present Value). These will help you determine whether the financial impact of your solution is substantial enough to justify its implementation.