Growth Strategy Accelerator

Company Profile Selected Statistics

E.I. du Pont de Nemours (DuPont) is the number-three U.S. • FY2004 Revenue: US$27.3 Billion
chemical maker and has undergone a restructuring that
consolidated 18 strategic business units into five growth • FY2004 Earnings: US$1.8 Billion
platforms. These platforms produce coatings (automotive • FY2004 Employees: 60,000
finishes and coatings); crop protection chemicals and
genetically modified seeds; electronic materials (LCDs,
sensors, and fluorochemicals), polymers, and resins for
packaging and other uses; and safety and security materials
and chemicals. The company has sold its former subsidiary
INVISTA (maker of polyester fibers and nylon, including
Lycra and Stainmaster) to Koch Industries for US$4.2 billion
in a deal that closed in April 2004.

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: http://www.hoovers.com; E.I. du Pont de Nemours &
Co.; Corporate Strategy Board research.

97
 Aligning Goals and Resources: Translating Strategy into Action 98

New Strategy, New Execution Challenges

• After years of focusing on efficiency improvements and
cost cutting, the CEO launches an initiative for “knowledge-
intensive” growth (new business models to deliver value-
added products and services), creating a new set of execution
challenges for the company.
• Given the company’s new strategic direction, some
businesses lack the tools and experience to translate the
corporate strategy into high-potential strategic initiatives
and find it challenging to generate buy-in and resource
commitment by the multiple parties required for successful
strategy execution.
 Where to Start?
DuPont shifts its strategy to overcome …taking the company outside
price pressures in its commoditized industry… its normal range of execution
Knowledge-Intensive Growth Avenues Strategy Execution Challenges
DuPont, Illustrative DuPont

DuPont Barriers to Execution Success

Knowledge
Intensity Future

New
Services High-Level Inadequate Fragmented Funding
New Value Strategy Toolkit Commitment Uncertainty
Chain
Position
New
Technology
Strategy Work Plan
$
New Difficult to Lack tools to surface Failure to generate Lack of confidence
Channels operationalize and test execution early buy-in among in execution ability
strategic objectives, barriers for new key groups critical to hinders resource
Basic Material/ particularly for ideas execution commitment
Asset
Products a strategy with
Intensity DuPont 1998 Emerging high market
Markets or technology
uncertainties

Increasing Share of Customer Wallet

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
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 Aligning Goals and Resources: Translating Strategy into Action 100

Fact-Based Execution Testing

• To help businesses translate the company’s new strategic
vision into high-value initiatives, DuPont creates the
“Knowledge-Intensive University” (KIU) in 1999—a
disciplined process that generates agreement among
mid-level managers, marketing and technical professionals,
and senior executives about key execution challenges and
whether DuPont can “win” in the marketplace.
• With the help of internal strategy consultants, project teams
spend four intense days at an off-site location testing
execution alternatives and identifying critical execution
uncertainties that must be resolved prior to initiative launch;
senior leaders are not involved in the Business Builder
session to prevent a dominant voice in the room from
biasing the analysis, but external experts with market and
technical knowledge are included on the team.
• To compress decision time and foster commitment, DuPont
book-ends the execution planning and barrier identification
with Leadership Sessions that provide screening criteria on
the front end and resource decisions on the back end.
 A “How-To” Guide for Strategy Execution
DuPont Develops Fact-Based Tools and Processes to Generate Agreement
on Potential Barriers and to Foster Commitment Among Groups Critical to Execution
Knowledge Intensive University
DuPont

Leadership Industry/
Business Builder Session Leadership
Session 1 Market Day One Day Two Day Three Day Four Session 1I
½–1 day Discovery Overview Idea Synthesis
High-Level ½ day
4–6 weeks Presentation
Business Model Financials
People
• DuPont Growth
Development (Business case) Action
Business Strategy
Plan
Unit A B • Forum Overview
Strategic
Internal consultant • Goals D ED
Initiative interviews BU
staff to understand Real Options Action Plan/ FU N
Proposal Resource
knowledge Estimation F
level, biases, and Growth
• Develops personalities; Staircase
A • Scores projects
customized recruits internal External Expert Hypothesis against
screening and external Presentations Development screening
criteria experts C Capability criteria
• Commits to Assessment D Presentation
Data • Commits to
supporting Finalized
Idea Generation action plan and
projects that Compiles market
funds resource
meet the and trend data
to test financial
requests for
criteria approved
and strategic
• Reviews assumptions Dinner Dinner Dinner initiatives
pre-work and Management
develops growth Systems Thinking Issue Tree Review
Speaker
Business Model E
concepts Training
“Thought Starter”

Setting Scope Identifying Critical Execution Uncertainties Negotiating

Resources

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
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 Aligning Goals and Resources: Translating Strategy into Action 102

Defining Success
• In the first Leadership Session, senior leaders explicitly state CSB View
the funding criteria against which proposed strategic
initiatives will be evaluated. Bookend the execution planning process with leadership sessions that
define investment criteria on the front end and commit resources on
• The opportunity screening criteria are customized, but the back end for advancing a strategic initiative.
typically fall under three broad themes—market relevance,
uniqueness, and commercializability.
• Senior leaders are making an implicit commitment to
Business Builder teams to resource opportunities that meet
the predefined criteria and are high priority from a portfolio
perspective.
Component A: Commitment Criteria

“Forward Contracting” Commitment

Senior executives define success …and make an implicit agreement to fund initiatives that
for Business Builder teams up front… meet the screening criteria and support strategic goals
Customized Screening Criteria Development Implicit Executive “Contract” with Business Builder Teams
Leadership Session I, DuPont, Illustrative Leadership Session I, DuPont, Illustrative

“I don’t think we have

the technical capability “If it can’t be a global
to win” initiative, it’s not worth
my time”

“If you”…
Support hypotheses with facts

“A successful initiative has to go beyond Corporate Propose initiatives that support

just meeting customer specs—it Strategic
Plan

should change how they do business” strategic goals

…“we will”…
$ Fund initiatives though first stage-gate
Opportunity Screening Criteria
Exceptional—9 Acceptable—3 Unfavorable—1
Secure personnel to execute initiative
Speed to building
capability platform
Relevance to Commit management time to support
global market initiative
Ability to create or
discontinuity

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
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 Aligning Goals and Resources: Translating Strategy into Action 104

Business Builder Workshop

• DuPont identifies execution barriers more accurately and
accelerates their removal by involving functional, mid-level,
and peer experts in executability testing prior to funding
an initiative.
• During the Business Builder session, project teams
decompose strategic objectives into an actionable work
plan that will result in execution success; the work plan is
imperfect but contains sufficient detail to make the
strategy “real” for the people most likely required to
implement proposed initiatives.
• To assess execution capabilities, DuPont identifies the
appropriate sequence of action steps, mapping each activity
to the capabilities required for its successful completion; the
team then determines whether the capability currently exists,
can be developed through the identified action steps, or must
be acquired independently of the execution plan.
• No Business Builder workshop can settle all execution
issues with an adequate degree of certainty; DuPont
generates agreement about the most critical execution
uncertainties and focuses resources on their rapid resolution.
 Building Executive Confidence
Key Components of the Business Builder Session Help Drive Executives Toward
Resource Decisions by Clarifying the Magnitude and Timing of Resource Requirements
Key Business Builder Components and Benefits
B C & D E
Right People Risk-Controlled Execution Barrier
in the Room Market Entry Prioritization
4

• DuPont Approach: Convenes mid-level, • DuPont Approach: Break long-term strategic • DuPont Approach: Identify and prioritize
functional employees and subject-matter experts goals into a series of near-term action steps with critical execution uncertainties and concentrate
for a four-day period to collectively surface exit options and sequence capabilities to be built resources on their early resolution
capability and resource gaps over time

• Benefit: Resource owners know the team’s • Benefit: Prevents killing initiatives that may • Benefit: Prevents overwhelming ROI benefits
recommendations have been tested by relevant appear to be unmanageable “large leaps” into with execution barriers that have marginal impact
experts and committed to by people involved in unfamiliar terrain on success
day-to-day strategy implementation

Business Builder Vital Statistics

• Process: In addition to the above components, Business Builder • Facilitation: Internal consultant facilitates KIU process on a fee-for-
teams create a business case with high-level financials, conduct service basis
market analysis, and build an action plan
• Cost: Approximately US$60,000 to US$70,000, including pre-work,
• Duration: Intensive, four-day session off site; daily workshops can facilitation, and facilities charges
last up to 18 hours

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
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 Aligning Goals and Resources: Translating Strategy into Action 106

Getting the Right People at the Table

• Companies often fail to consult with key stakeholders in CSB View
the early phase of execution planning, increasing the risk
that foreseeable execution barriers are only uncovered after Combine cross-functional representatives from the team tasked
launching an initiative when costs are higher. with executing a business development initiative with company and
external experts on the market space, technology, or business model
• DuPont identifies execution barriers more accurately and under consideration to surface and resolve execution barriers as early
accelerates their removal by involving functional, mid-level, as possible, before investment.
and peer experts in executability testing prior to funding
an initiative.
Component B: Right People
Widen the Circle
To Improve Accuracy of Execution Testing and Foster Early Commitment Among Key Groups,
DuPont Seeks Input from Actors Typically Left Out of the Execution Planning Process
Participants in Executability Testing
1 Traditional Approach Versus DuPont 2
Traditional approach: Business leader consults “Business Builder” Approach Traditional approach: Key functions are not
mid-level employees on an ad hoc basis, if at all. consulted until execution is under way and/or
DuPont approach: Consult mid-level employees functional capabilities are assumed.

Fu rese
who have a firm grasp on market and technology DuPont approach: Pull forward functional

Re
nc nt
p
m
and will be required to execute the strategy. involvement to more accurately determine

tio ati
Tea
capability gaps and resource availability.

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Strategy Practice
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.
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3
Traditional approach: Siloed capability Building the Expert Rolodex
assessment fails to leverage expertise outside the
business unit.
Experts “We’ve done about 85 of these sessions, so we have a good
understanding of what the businesses are doing and who
DuPont approach: Leverage internal and the experts are.”
external experts with experience in relevant Dan Edgar
market, business model, technology, etc. Practice Leader, Business
Growth Process, DuPont

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
Growth Strategy Accelerator 107
 Aligning Goals and Resources: Translating Strategy into Action 108

The Descent from 30,000 Feet

• Failure to translate vague, high-level strategies into tangible CSB View
execution steps before securing commitment and
conducting capability assessments can result in strategy Develop operational plans by disaggregating each hypothetical
stalls as individuals realize, post-launch, the effort and business building strategy to highlight the relative ease or difficulty
resources required to execute the strategy. of each required action step.
• During the Business Builder session, project teams
decompose strategic objectives into an actionable work
plan that will result in execution success; the work plan is
imperfect but contains sufficient detail to make the
strategy “real” for the people most likely required to
implement proposed initiatives.
• The participation of internal subject-matter experts with
deep knowledge of markets or technologies enables the team
to more credibly and accurately identify key action items
and the organizational capabilities required for success.
• External experts with knowledge about markets, value
chains, and technology trends outside of DuPont’s
experience are invited to participate in part of the Business
Builder session to make the analysis more robust and inject
new ideas and perspectives into the debate.
Component C: Operationalized Hypotheses
From Aspiration to Action
Before It Can Assess Its Ability to Execute, the Project Team Must
Operationalize the Strategy So Execution Requirements Are Clear
Strategy Operationalization Process
Hypothetical Oral Care Example

To achieve this aspiration… Hypothesis: DuPont will be the leading provider of speciality oral
care products to health care professionals and consumers

1 2 3 4
Develop the technology to Implement a marketing Gain access to retail channels Develop specialized sales and
…we must deliver on provide oral care products strategy to build brand and dentist offices customer support for oral
these strategic with cosmetic and medical recognition for ingredients care professionals
objectives… benefits and end products

…which require these • • • •

action steps • • Sell new products directly • •
• Commercialize new products to brand owners • Launch co-branded products: • Pilot tests in U.S. dentist offices
• • DuPont ingredient brand and •
• Co-brand with dentists and a consumer brand
oral surgeon associations •
• Introduce branded products
in U.S. retail outlets

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
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 Aligning Goals and Resources: Translating Strategy into Action 110

Writing Your Future Business History

• Typical capability assessments identify gaps between existing CSB View
and required capabilities but stop short of specifying at what
point in the execution timeline those gaps must be closed, Sequence over time the action steps required for a potential strategy
increasing the risk that business leaders underestimate the to achieve success and perform a gap analysis on capabilities required
time required to strengthen existing or build new of each action step.
capabilities.
• To assess execution capabilities, DuPont identifies the
appropriate sequence of action steps, mapping each activity
to the capabilities required for its successful completion; the
team then determines whether the capability currently exists,
can be developed through the identified action steps, or must
be acquired independently of the execution plan.
• When building the capability platform, Business Builder
teams start by identifying the desired end state, and then
work backward to identify what action steps and capabilities
will help them realize that aspiration.
 Component D: Capability Assessment
Time-Sensitive Capability Analysis
Sequencing the Interaction Between the Work Plan and Organizational Capabilities Enables a More
Realistic Assessment of DuPont’s Ability to Close Capability Gaps Before They Stall Execution
Capability Platform: Hypothetical Oral Care Example
DuPont Aspiration
4 Expand into U.S.
Existing Capabilities Retail Business
New Capabilities
• Introduce branded products in
U.S. retail outlets
3 Expand into U.S.
Oral Care Market
• Co-brand with dentists
and oral surgeons

2 Co-Launch New Offering

• Launch co-branded products:

DuPont ingredient brand and a
1 Access to Brand Owner consumer brand
Action • Commercialize new products
• Pilot test in U.S. dentist office
Steps
• Sell new products directly to
brand owners
Focused technical Product Brand
Organizational Active Compound IP service Recognition
Capabilities Formulation
Market Access Ingredient Brand
Delivery System IP Recognition Established Market
Capabilities Position

2002 2006
* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
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 Aligning Goals and Resources: Translating Strategy into Action 112

Surfacing Critical Execution Barriers

• Business Builder participants consider all the available data CSB View
and analysis to generate a list of execution-related questions
for which they do not have answers and then vote on which Differentiate among the remaining execution uncertainties to
of those issues are most critical. identify “showstoppers” that would invalidate the initiative’s business
case and create action plans to reduce those critical uncertainties as
• The quality of the data compiled during the pre-work soon and as efficiently as possible.
phase has a significant impact on the number of critical
uncertainties that remain at the end of the Business Builder,
and by association, the magnitude of the funding decision
made in the final Leadership Session.
• No Business Builder workshop can settle all execution
issues with an adequate degree of certainty; DuPont
generates agreement about the most critical execution
uncertainties and focuses resources on their rapid resolution.
• Identifying potential execution challenges and ways to
overcome those challenges not only avoids execution
derailment but motivates the team to put the strategy in
action because they believe they successfully execute.
Component E: Issue Tree

Gaining Agreement on “Showstoppers”

Project team reaches agreement on critical …and develops an action plan
issues that could derail execution… to lower barriers
Execution “Issue Tree” Action Plan for Reducing Execution Uncertainties
DuPont, Illustrative DuPont, Illustrative
Critical
• How big can the market be without x access? Action Plan
Market • How can integration upstream and downstream bring value?
Space Goal: Develop fact-based execution plan in 90 days
Activities
• Assemble portfolio of potential
Non-Critical technologies; evaluate capabilities
Unresolved • Who is best provider of complementary product x?
against customer needs
Execution • Improve supply chain understanding
Issues
• Deconstruct market size figure
Critical • Test value proposition with a sample
Business of customers
• Can we obtain a leading position in key technologies?
Model/ • What are the costs related to t in x? • Financial evaluation (with and without x)
Technology Options for cost reduction? • Integrate other teams plans
• With which customer should we start development?
Resource requirements
• Can we acquire capability x in next 12 months?
Three to four full-time people
By vote, team identifies
potential “showstoppers”— Non-Critical
issues that, on their own, • Can we improve turnaround time in factory x?
could kill an initiative. • Do we have to relocate our warehouse closer to customer y?

Key Inputs for Building Issue Tree

• Screening criteria from • Hypothesis statement • Business model summary • Market space analysis
Leadership Session I (see Appendix)
(see Appendix)

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
Growth Strategy Accelerator 113
 Aligning Goals and Resources: Translating Strategy into Action 114

Leadership Alignment
• Senior leaders join the end of the Business Builder to hear CSB View
teams present their findings and to score proposed initiatives
against the customized investment criteria developed in the Compare the fully developed business building initiatives to the
first Leadership Session; scoring is not designed to be original screening criteria, consider cross-initiative portfolio impacts,
scientific but as a tool to surface different perspectives about and commit resources—financial and human—to the initiatives
the value of an opportunity. most attractive from an enterprisewide perspective.
• The Leadership Session participants reach agreement on the
best initiatives to pursue, critical execution uncertainties,
and the next steps required to reduce uncertainty to
a level where more significant funding can be released.
• To generate commitment and momentum, DuPont invites
all business, regional, and functional leaders whose
resources or approval are required for execution to attend
the final Leadership Session; however, the seniority of the
assembled leadership is matched to the project’s materiality
to avoid overburdening executives.
• Planning for execution without consulting peer business
leaders and functional heads that control critical resources
increases the risk that those resources will be unavailable
when they are required, either because they do not exist or
because uncommitted leaders refuse to make them available.
Component F: Resource Prioritization

Commitment Accelerator
Business Builder teams present …spend up to five days …and reconvene to commit resources
findings to senior leaders who then assessing portfolio impact… for approved strategic initiatives
evaluate proposed initiatives…
Business Builder Session: Management Review Portfolio Considerations Leadership Session II: Resources Decision
DuPont DuPont DuPont, Illustrative
High-Level Financials
Business
Initiative
ScoredCAction
Initiative
C Model Summary
by: BusinessPlan Builder Team
Existing Portfolio New Initiative Initiative B
Scored C by: Business
Capability Platform Builder Team
Initiative
Scored
Initiative CIssue by: Business
Potential for
Tree
Exceptional–9 Acceptable–3 Unfavorable–1
Builder Team
Exceptional–9 Acceptable–3 Unfavorable–1
Initiative ARequest
Resource
Differentiation
Scored
Screening by: Business
Potential for
Management
Criteria Builder Team
Initiative
Scored
Initiative C by:
C Differentiation
Business
Route-to Management
market
Exceptional–9 Acceptable–3 Unfavorable–1
Time requirement
Builder Team
Exceptional–9 Acceptable–3 Unfavorable–1
Resource
• 3-4 Requestemployees
FT director-level
Time requirement
Position

Business Builder Scored by: Business

Potential for
Management
Differentiation
Builder Team
Time requirement
Route-to market
for 90 days
• 3–4 FT director-level
Outputs Exceptional–9
Position
Potential forManagement
Differentiation
Time requirement
Acceptable–3 Unfavorable–1
• Focus group
employees for 90- $75,
days 000
Route-to market
Position
Management
Time requirement
• Travel
• Focus and—US$75,000
group expenses - $11,000
• Travel and expenses—US$11,000

Approved
• 3 FT employees (2 director level, 1 manager level)
Portfolio Evaluation • US$75,000 for focus group
Senior Executive
Evaluation Evaluate existing initiatives against screening • US$9,000 Travel and Expenses
criteria to enable comparison
Identify potential team members with Initiative D
appropriate skills and experience Resource C
Initiative Request
• 3-4Resource Requestemployees
FT director-level
Assess impact of resource shifts
• Resource owners independently score initiatives • Stafffor(390 daysManager level, 6
FTE,
against screening criteria and agree on best Negotiate with resource owners • Focus group - $75, 000
months)
• TravelManagement–US$150,000
• Project and expenses - $11,000
execution alternatives
• Travel and expenses–US $24,000

• Scores do not determine resource allocation, but Resource Trade-Off

are used as a discussion tool “Money isn’t the real issue—people are.” Killed for Cause
• Low confidence in capability assessment
Dan Edgar
DuPont
• Lower priority relative to other project alternatives

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
Growth Strategy Accelerator 115
 Aligning Goals and Resources: Translating Strategy into Action 116

Accelerating Strategy Impact

• Faced with a new strategy requiring the business to expand
beyond its core product, the Non-Wovens business sends a
team to KIU to jump-start strategy execution and identify
the most attractive execution alternatives.
• The KIU process not only speeds identification of
high-potential initiatives that have since been successfully
launched but also enables the business to weed out execution
options that initially seemed attractive, but overreached their
ability to win in the marketplace.
• The KIU process significantly enhanced DuPont’s ability
to execute on its growth strategy as evidenced by the
improvement in the quality of initiatives the company is
pursuing and their impact on the company’s bottom line.
Results

Jump-Starting Execution
DuPont’s process enables business units …and positively impacts corporate performance
to realize greater value from strategic plans…
Corporate Priority Technology
KIU—Tyvek® “Weatherization” Example Projects Post-Portfolio Review
Non-Wovens Business, DuPont, 2002 DuPont, 2004

Corporate Vision
Profitable revenue growth through knowledge-intensive offerings 20%
Business Unit Strategy
Pursue adjacencies beyond core Tyvek® HomeWrap® 80%
product for the construction market
KIU
= 75. Projects

Joints and Sealants HVAC Weatherization

Additional Benefits of KIU

Killed because Killed because too far Deemed most Approximately US$150 million of annual earnings
overestimated outside capabilities attractive attributable to KIU projects as of 2004
market opportunity execution option

Speed to Market
Tyvek ® Roofing System— SentryGlas® —Reinforced DuPont StormRoom® — “The KIU accelerates commitment among business
Airtight, water-tight glass that resists breakage In-home storm shelter built leaders and their teams and helps us get new offerings to
roofing membrane that is and prevents shattering with Kevlar ® sheathing market more quickly.”
“breathable,” allowing interior during hurricanes; also used inside to reinforce walls; Dan Edgar
moisture to escape by Packaging and Industrial protects against wind-borne Practice Leader,
Polymer SBU missiles Business Growth Process
DuPont
Leveraging Internal Expertise
Strategist facilitates collaboration with expert from Advanced Fibers Platform who has
intimate knowledge of Kevlar ® technology (material used in bulletproof vests).

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
Growth Strategy Accelerator 117
118
 Appendix
Growth Strategy Accelerator

119
Aligning Goals and Resources: Translating Strategy into Action 120
 Screening Criteria: Categories to Consider
What Is the Basis for Choosing the Screening Criteria?
ü Experience suggests that there are some categories that are useful to think about when
you select the screening criteria
ü Categories to consider are
ÿ Market Opportunity
ß Market size
ß Growth rate
ÿ Market Attractiveness
ß Trends
ß Discontinuities
ß Competitive dynamics
ÿ Near-Term Prospects
ß Defined customer group
ß Potential for differentiation
ß Potential revenue in three to five years
ÿ Operational/Execution Aspects
ß Adjacency success factors (around strongest cores/leadership economics; repeatable
characteristics; around strongest customers)
ß Resource needs (with a clear description of what kind of resources—capital, people,
management time)

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
Appendix: Growth Strategy Accelerator 121
 Aligning Goals and Resources: Translating Strategy into Action 122

Opportunity Screening Criteria—Example

Market Relevance
Exceptional—9 Acceptable—3 Unfavorable—1
Strong Customer Pull There is clear evidence either from needs-based There is evidence the customer desires our Customer demand was determined by internal
segmentation studies or actual customer offering through discussions—we asked what studies
experimentation that there is strong customer they want from DuPont as an example
demand
Favorable Trends We expect > 2 GDP growth because there is We expect 1 to 2 X GDP growth since the trends Our growth potential is less than GDP since
(Growth Rate) strong macro economic, industry, or regulatory are neutral to our offering, Moderate FTA the trends seems to be working against us;
trends that favor our offering at the customer, Conditions unfavorable/weak FTA conditions
Favorable FTAs
Size of DuPont Opportunity The potential size of the opportunity is >$50 M The potential size of the opportunity is The potential size of the opportunity is < $25 M
in Country X in Year 5 $25 M–50 M

Ability to Create a Our offering has the potential to fundamentally Our offering significantly improves how our Our offering just meets the specified physical
Discontinuity changes how our customers do business customers do business attributes

Improves Life for Society Positive impact of BoP needs and societal values, Marginal impact on BoP needs and societal Not a clear view on how can directly positively
e.g., income creation, lower costs, job creation, values. Moderate environmental impact impact BoP; large negative environmental
access to better products, etc; sustainable—no impact
environmental impact
Route-to-Market Position We can secure a very strong, defensible route-to- We can get to market Our route-to-market will most likely be blocked
market without significant effort to restructure the
industry
Relevance to Global Markets Applicable to other global markets. The potential May be applicable to other global markets with Applicable only to the South Asian region;
size of global opportunity > 200 M some modifications; potential size of global potential size of global opportunity < 100 M
opportunity in the range of 100 M–200 M

Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
 Opportunity Screening Criteria (Continued)
Uniqueness
Exceptional—9 Acceptable—3 Unfavorable—1
Competitive Position We can see a way to become the best in the world We can be comparable to other suppliers but can We are a “me-to” supplier with no real
at delivering the offering to our target customers establish a strong competitive position competitive strength
and thereby develop a unique competitive
position
Intellectual Assets to Sustain We have a strong portfolio of intellectual assets We have an intellectual asset position but its We have little if any protection
(patents, know-how, etc.) to protect our position sustainability is a concern
into the foreseeable future

Commercializability/Time to Market
Speed to Building Capability The capability platform required to The capability platform required to The capability platform required to
Platform commercialize the offering is in place commercialize the offering can be developed commercialize the offering will be very difficult
over time at an acceptable cost and risk to develop at an acceptable cost and risk
Rapid Customer Acceptance The offering can be used by our target customers Our customers will have some cost and/or risk, Our customer will have significant cost to adapt
with minimal cost, time, or risk to them; the e.g., in retooling, but they deem it acceptable; our offering into their system and this could be a
ability for them to use our offering will not this will impact our time to market, however real barrier to our ability to commercialize
impact the time to market
Short-Term (Two Year) Generates positive earnings and cash flow Generates positive earnings but negative cash Generates negative earnings and negative cash
Financial Impact flow flow

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
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Growth Strategy Accelerator 123
Aligning Goals and Resources: Translating Strategy into Action 124
 Business Model Summary

BUSINESS CASE ELEMENTS

Value • How do we create value for the customer?
Proposition • What needs are we satisfying?

Unit of • What combination of products, service, and solutions do we want to sell?

Business

Value Capture • How do we capture, as profit, a portion of the value we created for
customers?
• What is our profit model? Can we develop a non-auctionable system?

Sustainability • What makes my proposition unique versus other competitors?

• What strategic control points can counterbalance customer or competitor
power?
• Are we the “center of gravity” or ancillary to the offering?
Scope • Which activities or functions do I want to perform in house?
• Which ones do I want to subcontract, outsource or work with a partner
to provide?

* Registered trademark of E.I. du Pont de Nemours & Co., Wilmington, Del. Source: E.I. du Pont de Nemours & Co.; Corporate Strategy Board research.
*
Growth Strategy Accelerator 125