MAD HATS currently faces obstacles to growth including market saturation, lack of marketing strategy, and disconnected IT systems. The document recommends (1) introducing seasonal hats tied to causes, (2) utilizing IT systems like ERP and SOA for operations and analysis, and (3) restructuring leadership and adding positions like CIO. These strategic, technological, and human capital initiatives would work together to help MAD HATS overcome barriers through frequent product releases, expanded demographics, and optimized operations. The recommendations are estimated to cost $750,000 initially but would make the company profitable over $15 million within 5 years according to risk analysis.
3. MAD HATS currently faces many severe threats to growth
18-28 year old market saturation
Lack of clear marketing strategy to reach new markets
Limited e-commerce & unreliable IT architecture
Nonexistent ERP system for operational efficiency
Disconnect between business strategy and IT
4. The optimal solution involves strategic, technological, and human capital
initiatives working together toward common goals
Human Capital
Technology
Strategy
Release New Hats Seasonally Create CDN for Short-Term Support Restructure for Efficiency
Tie Hats to Specific Causes Establish Functional ERP System Empower Technology Team
Expand Target Demographic Enhance E-Commerce Offerings Consider New Positions in Long-Run
Develop SOA Functionality
5. The optimal solution involves strategic, technological, and human capital
initiatives working together toward common goals
Human Capital
Technology
Strategy
Release New Hats Seasonally Create CDN for Short-Term Support Restructure for Efficiency
Tie Hats to Specific Causes Establish Functional ERP System Empower Technology Team
Expand Target Demographic Enhance E-Commerce Offerings Consider New Positions in Long-Run
Develop SOA Functionality
6. Three obstacles currently inhibit attaining establish revenue growth goals
25% Annual Growth
Saturation of Current Markets
Narrow Product Offerings
Limited Marketing Activities
Current Sales
Our Recommendation
MAD HATS can overcome its current barriers to success by (1) frequently introducing seasonal
hats, (2) tying hats to specific causes, and (3) actively marketing to a wider demographic
7. MAD HATS will introduce new hats seasonally to prevent customer
disinterest and provide new marketing content
Invest in Consumer Survey Proposed by Marketing Dept.
Strategy
Release New Hats
Seasonally
New Hat Released
Marketing
Campaign
Tie Hats to Specific
Causes
Analysis
Expand Target Transaction
Demographic
Donation
Delivery
Customer
Delivery
8. Seasonal, limited-edition hats will inspire collections, brand loyalty,
and justify higher prices
Strategy
Past Successful Strategy Implementations
Release New Hats
Seasonally
Ty Toys: Beenie Babies
Tie Hats to Specific
Causes
The Longaberger Basket Company
Expand Target
Demographic
Hard Rock Café Branded Merchandise
9. Seasonal, limited-edition hats will inspire collections, brand loyalty,
and justify higher prices
Strategy
Release New Hats
Seasonally
Tie Hats to Specific
Causes
Expand Target
Demographic
• Seasonal, limited-edition hats will benefit specific destinations
• Related marketing materials will be created for each release
• Promotes further humanization of the MAD HATS brand
10. Geographical and cultural elements of the final recipient will inspire
each hat’s design
Strategy
Release New Hats
Seasonally
Tie Hats to Specific
Causes
Expand Target
Demographic
“Get to Give” Benefiting Impoverished Children in China
11. MAD HATS will leverage seasonal hat releases and a stronger human
element to expand its target demographic
Key Attributes
Strategy Consumers aged 15-39 are
18-28 the most likely to support
45% companies with positive
social impact
Release New Hats
Seasonally
28-38 Higher purchasing power
15% than younger counterparts
Tie Hats to Specific 38-48
Socially-minded consumers
Causes 0-18 10% are more likely to use social
23% 48+ media to help make purchase
7% decisions (59% v. 46%)
Expand Target
Demographic
Recommended Actions
• Utilize social media marketing to reach the older demographic
• Minimize advertising cost through SEO and social media ads
• Complete consumer market study to understand new targets
12. The optimal solution involves strategic, technological, and human capital
initiatives working together toward common goals
Human Capital
Technology
Strategy
Release New Hats Seasonally Create CDN for Short-Term Support Restructure for Efficiency
Tie Hats to Specific Causes Establish Functional ERP System Empower Technology Team
Expand Target Demographic Enhance E-Commerce Offerings Consider New Positions in Long-Run
Develop SOA Functionality
13. Implementing new IT systems will allow MAD HATS to optimize data
storage, business operations, and strategic analysis
Implement IT Conduct Formulate Plan
Systems Analysis Strategy Implementation
Evaluate
Strategic
ERP Current Action Plan
Options
Data
Future
Key Business Strategic
Core Data Industry Plans
Insights Decisions Direction
Scenarios
Internal Risk and Financial
SOA
Analysis Reward Plan
Strategy Recommendation
14. Utilize CDN technology to support heavy holiday-season traffic in
the short term
CDN technology prevents website lag and downtime by
Technology
sending bandwidth through geographically-efficient servers
Create Cloud CDN for
Each user sees maximum content bandwidth
Short-Term Support
Establish Functional
ERP System
Develop SOA
Functionality
Enhance E-Commerce
Offerings
For every 100 milliseconds of load time improvement,
Amazon.com increased its over all revenue by 1%
Source: mashable.com
15. NetSuite ERP system will help collect and store financial,
operational, and market-based information
Technology
Create Cloud CDN for
Short-Term Support
Establish Functional
ERP System
Develop SOA
Functionality
Enhance E-Commerce
Offerings
16. NetSuite ERP system will help optimize all aspects of MAD HATS
day-to-day operations
Technology
Create Cloud CDN for
Short-Term Support
Prevent donation losses or non-optimal shipments
Establish Functional
ERP System
Analyze sales, operations, and marketing in real-time
Develop SOA Streamline deliveries
Functionality
Manage non-profit partnerships
Enhance E-Commerce
Offerings
Track production levels, inventory orders, and project life-cycle
17. MAD HATS will pursue service-oriented architecture to make all systems more flexible,
more scalable, and easier to maintain; it better facilitates future growth and planning.
Technology
Create Cloud CDN for
Short-Term Support
Establish Functional
ERP System SOA
…
Develop SOA
Functionality
Enhance E-Commerce
Offerings
18. MAD HATS will enhance e-commerce offerings to optimize the online shopping
experience after the ERP is stable
Technology
Create Cloud CDN for
Short-Term Support
E-Commerce
Wave 3
Establish Functional
ERP System
Rich Technology Product Wikis &
Loyalty Programs
Develop SOA Applications Videos
Functionality
Enhance E-Commerce
Offerings
19. The optimal solution involves strategic, technological, and human capital
initiatives working together toward common goals
Human Capital
Technology
Strategy
Release New Hats Seasonally Create CDN for Short-Term Support Restructure for Efficiency
Tie Hats to Specific Causes Establish Functional ERP System Empower Technology Team
Expand Target Demographic Enhance E-Commerce Offerings Consider New Positions in Long-Run
Develop SOA Functionality
20. MAD HATS will restructure several executive-level positions and add two new
members of the leadership team
Human Capital CEO
Restructure for
Efficiency President
Empower Technology
Team CIO COO CFO
Consider New Positions
in Long-Run
VP
Technology VP VP
Human
Director Strategy Marketing
Resource
Design
Director
21. MAD HATS will restructure several executive-level positions and add two new
members of the leadership team
Human Capital
New Positions
• Director of Design--reports to VP Strategy, responsible for
managing current products, designs hats for seasonal release
Restructure for • Chief Information Officer—reports to President, manages all
Efficiency information systems for MAD HATS strategy & operations
Empower Technology Additional Structural Changes
Team • VP Human Resources-now reports to COO instead of CFO
• Director of Technology-formerly VP Technology, reports to CIO
instead of COO
Consider New Positions
in Long-Run
Action Items
• Promote VP Technology to CIO, hire new Technology Director
• Hire/onboard Director of Design
• Facilitate transitional meeting between VP Human Resources
and COO
22. MAD HATS will take specific actions to empower the technology team to
integrate all aspects of the business
Human Capital
Restructure for
Efficiency
Empower Technology
Team
Consider New Positions
in Long-Run
• Creation of CIO position increases communication
between President and Technology team
• Expanding the team’s size will increase the scope of
possible projects
• Clearly communicating the corporation’s goals will help
IT align their actions with general business strategies
23. When MAD HATS has additional available capital, 3 new Human Capital additions will
enhance current initiatives
Human Capital
Design Technology
CIA Team Team
Restructure for
Efficiency
Implement
Ensure faithful Increase
Empower Technology
new features
representation frequency and
with e-
Team of “Get to variety of hat
commerce
Give” claim releases
function
Consider New Positions
in Long-Run Consider Mine better
Facilitate additional information
smooth product lines; from available
transition into support data for long-
external audits Director of term strategy
Design plannning
24. MAD HATS will implement the recommendations over an 18-month period while
considering holidays, release dates, and technology limitations
25. @Risk analysis shows the likelihood of project success is very high
• There is an 87% likelihood we break even in our first year
Breakeven
• We will reach a sustainable profit over the 5 year period of over $15 million
Profit
• We will incur approximately $750,000 of new costs during implementation
Costs
27. MAD HATS must be aware of 4 key risks associated with our strategy
Risk Overview Mitigation Strategy
ERP Technology Select a widely-used, web-based ERP
Incompatibility system supported by NetSuite
Donations are Utilize ERP to track inventory, purchases,
and donations; Hire Chief Internal Auditor
Lost or Misappropriated when budget allows
Wasteful Inventory Perform consumer market survey before
Shortages or Surpluses introducing new hats to accurately forecast
demand
Uncooperative Restructure corporate leadership to
Business Leaders encourage interaction between COO and
CIO; regularly communicate corporate goals
Severity
Probability
28. The optimal solution involves strategic, technological, and human capital
initiatives working together toward common goals
Human Capital
Technology
Strategy
Release New Hats Seasonally Create CDN for Short-Term Support Restructure for Efficiency
Tie Hats to Specific Causes Establish Functional ERP System Empower Technology Team
Expand Target Demographic Enhance E-Commerce Offerings Consider New Positions in Long-Run
Develop SOA Functionality
30. Appendix A: @Risk Cost Assumptions
Strategy Marketing Campaign 50,000
Hat Design and Production 10,000
Consumer Survey 100,000
S Total 160,000
Tech SOA
Short Term: CDN 5,000
ERP (NetSuite) 387,000
E-Commerce tools 100,000
Testing & Design 25,000
Data Transfer 5,000
T Total 522,000
Human Cap CIO 25,000
VP Tech 70,000
Staff Training 10,000
Deisgn Dir&team 70,000
HC Total 175,000