Page 86 - The Handbook for Quality Management a Complete Guide to Operational Excellence

72 I n t e g r a t e d P l a n n i n g S t r a t e g i c P l a n n i n g 73

assert, with an acceptable degree of confidence, that the condition
can be met? This may involve surveys of customers or suppliers,
or honest discussions with key customers or suppliers, depending
on the team’s confidence in the condition. The authors suggest
that the team members with greatest skepticism for a given option
be tasked with developing the tests for that option.
6. Conduct the tests. Implement the tests defined in the preceding
step. The authors recommend starting with the barrier condition
that the team has the least confidence in, on the premise that the
condition can be quickly dismissed without additional testing.
They refer to this as the “lazy man’s approach” and cite it as a key
driver for reducing costs and effort of the analysis.
7. Make the choice. The option with the fewest key barriers will naturally
surface as the preferred option by the team.

Lafley, a former chairman and CEO of Proctor & Gamble, cites the use
of the possibilities-based approach to strategic decision-making in P&G’s
transformation of the Olay product line to a premium “prestige” brand,
eventually accounting for $2.5 billion in annual sales. When considering
the option of marketing a prestige product to younger clientele through
mass-market channels, the following necessary conditions were defined
(Lafley et al., 2012):

• Industry segmentation. A sufficiently large number of woman want
to “fight the seven signs of aging.”
• Industry structure. The emerging masstige (i.e., a prestige product
in mass market) segment will be at least as structurally attractive
as the current mass-market segment.
• Channel. Mass retailers will embrace the idea of creating a masstige
experience to attract prestige customers.
• Consumers. A pricing sweet spot exists that will induce mass
consumers to pay a premium and prestige shoppers to purchase
in the mass channel.
• Business model capabilities. P&G can create prestige-like brand
positioning, packaging, and in-store promotions in the mass
channel; and P&G can build strong partnerships with mass retailers
to create and exploit a masstige segment.
• Costs. P&G can create a prestige-like product with a cost structure
that enables it to hit the pricing sweet spot.

• Competitors. Because of channel conflict, prestige competitors will not
try to follow Olay into the masstige segment; and mass competitors
will find it hard to follow because the lower price point is covered by
the basic Olay Complete line.

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