Evaluating business models and supporting the decision making for the engagement in a national defense program

Our client

Highly diversified with consolidated annual net revenues exceeding USD 10 billion, acting as an important player in the business fields of Cement, Concessions, Engineering and Construction, Rail and Energy, Apparel and Footwear, Real Estate Development and Ship Building, and employing almost 60,000 professionals in more than 20 countries, our client is among the largest business groups in Brazil.

Background:

• Existing assets and operations run by our client created motivation for the involvement in a national defense initiative, more specifically in the military ship building business.
• The market-entry decision making process had to consider a set of alternatives with different investment scenarios and specific strategic and operational roles in possible joint-ventures.

Approach:

• As a first step, we analyzed the risk taking awareness of decision makers and derived a corporate utility function in face of the risk sources associated.
• Secondly, we developed a pragmatic set of 17 business alternatives with expected financial and operational consequences.
• Finally, we evaluated every alternative and made our final recommendation based on market/competitors assessment and client's risk taking awareness.

Outcome:

• An objective market-entry decision making framework, comprehending business risks and opportunities.
• Guidelines for establishing joint-ventures with our client's potential international partners.
• Market potential, competitors, synergies and business cases analysis;
• Go-to-market strategy.