Peer Review

Growth and Competitive Strategy in Three Circles

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Reviewed:: Dec 29, 2022 by Business

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Ratings

Overall Rating:

Content Quality:

Effectiveness:

Ease of Use:

Overview:

The 3-Circle model for strategic planning “simplifies the integration of customer, firm, and competitor analysis to generate growth strategies. It also provides a common language and process for understanding and explaining competitive advantage and for identifying profitable growth strategy.” It offers fundamental concepts for creating a strategy to grow any business by breaking down complex ideas and then integrating them using a common language. The focus is external and internal. Different strategies are identified for different scenarios, and competitors’ actions and reactions are anticipated. The analysis is conducted at the segment level.

The three principles are: i) “defining advantage from the perspective of customer value;” ii) differentiating from the competition; and iii) “developing distinctive capabilities, resources, and assets to execute the positioning strategy.”

The approach is data-driven. “It is initially very important for the executive team to provide their own estimates of customer value before getting feedback from customers.” Internal perceptions about customers may be different from the data. It is recommended that data collection start small with interviews of no more than 10 customers.

Differentiation must be perceived by the customers in “ways that matter to customers” and the organization has the “resources or capabilities to build and sustain those differences.”

Type of Material:

Open (Access) Textbook

Recommended Uses:

Semester-long project in a graduate class

Applicable to working with an outside client

Technical Requirements:

None

Identify Major Learning Goals:

Understand growth and competitive strategies

Demonstrate marketing strategies to communicate product value and accessibility

Describe the three-circle analysis process

Target Student Population:

Graduate students in an MBA, marketing or strategy program

College Upper Division, Graduate School

Prerequisite Knowledge or Skills:

Marketing Principles

Content Quality

Rating:

Strengths:

Conceptually, the model is easy to understand. It is presented visually, verbally, and at times, mathematically. Visual diagrams are displayed to understand where an organization should focus. It has been tested on many executive MBA students. One-hundred-and-fifty-five in one year.

Concerns:

The examples are dated and may not capture attention. Some references are 10+ years old. Similarly, the model applies to Internet companies, but the book does not focus on them. The text is 130 pages, although it did not take too long to read. Artificial intelligence, machine learning, and text mining are not covered. The latter can be used to aid in assessing the value of social media posts. I would surmise that text mining could be used when data is gathered through laddering. A method advocated in the textbook.

Components of value are not weighted making them appear equally important, which is unrealistic. It does address very basic data collection methods but glosses over the more sophisticated statistical techniques needed to gather complex data used for analysis.

Many users may rely on internal knowledge or conduct rudimentary research and attempt to implement the model. “Most managers initially believe that they have a reasonable, intuitive understanding of the value customers seek. Yet with deeper discussions with customers, they very frequently discover insights that materially improve growth strategies.”

The addition of activities or application exercises would be helpful to practice concepts.

Potential Effectiveness as a Teaching Tool

Rating:
Strengths:: Very good, if adequate time is available This seems like a semester-long project. Could be easy to use in the right course. Strong information for more in-depth work on marketing strategy.
Concerns:: Could use learning objectives. Could use a follow-up or to scaffold some other concepts into it.

Ease of Use for Both Students and Faculty

Rating:

Strengths:

Very easy to follow. Written in an engaging manner.

Concerns:

Not very interactive, mostly text with some black & white graphics/images/charts

Accessibility on text is good; some alt text “issues” for images

Typo on “Refrences” (should be References), other minor editing issues

Other Issues and Comments:

Overall great resource

Easy to adapt to the course/topic

Research based

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