Speaker 1: Good morning, grade 12s, this morning we'll be looking at Chapter 2, and that is Creative Thinking and Problem Solving. You're going to see that there's quite an overlap with some of the tools that we've already learned about when we're looking at our various environments. So I just want to make sure that you know how to do that, and let's get started. So Creative Thinking is extremely important to know. You're going to see that the answers are not always going to just be there. You have to really think out of the box and really say, how are we going to solve this problem? What could we do? I know when we launched Zambac Coil, we had all this product left over and we were almost thinking, what are we going to do with it? How can we salvage this product? How can we still try and make money out of this loss that we've experienced? So we had to kind of strategize and try and come up with different ideas, not put it into the bags because we also sold Bepanthen, which is a baby cream. Could we not maybe put bags together and put the Zambac Coil and the baby cream in there and give it to two expectant moms? So we were really trying to think out of the box with regards to what to do. So look at your various stores, even from this, you can see Little Falls at Leroy Merlin, they do workshops, which is so clever because it really is bringing people into the store. You've been selling the material that you have, and there's a whole engagement level, which is pretty important in today's day, is engagement and customers kind of having a real relationship with the store. Right, so how do we, why do we have to problem solve? It's always to maintain a competitive advantage. You're going to talk about competitive advantage in everything that you do in business. It's all about making sure that you are better than the competitors. So was it a competitive advantage, you're going to either look at, do we go into new geographic regions? Can we move our store? So could we move Pick'n'Pays into various African countries, which they're already doing? And they were looking at even Australia at one stage. Do we look at new market segments? So do we go into, and I've just put a little picture there, do we go into the vegan range? And we try and be more vegan-orientated in our stores and possibly have a vegan facility? I mean, that could be incredible because there's no offering at the moment. So Pick'n'Pays, as you know it, we're going more plant-based. We're going to have a whole daily section where people can come through, vegans, vegetarians can come through and they can actually collect some pre-made meals maybe even. Or you're also going to look at new product ranges, which are launching into new products. So something completely different. And that could also stem into your vegan, vegetarian ideas that you have. Have a look at market segmentation in your supermarkets. This is actually found on the internet. They segment their shoppers. So you've got the fast and furious shoppers. You've got your budget-conscious shoppers. A day out where, you know, it's someone that's just going to have a day out and do her thing or his thing. Gourmet-focused shoppers. Smart shoppers that are looking at discounts and all sorts of things. And they'll go to something and then they'll go to check us for something else. Here we go again, which is the grudge-purchase shopper. You'll see when you have children one day and you have to go to the store every single week because you have to cook something. And so here we go again, shopper. And then you've got your variety seekers, which go in and go down the aisles and have a look at what's new. That is quite a nice way to segment the market in your supermarkets. And they've given them little names. So just to give you some insight into ShopRite. ShopRite has a customer-first culture. They do a lot of data analysis with the baskets. And they're really trying to understand their customers. It's important for creative problem-solving to understand who your target market is. So they've got a growing LSM 8 to 10 share of wallet market. You know, they do definitely cater for your lower LSMs. But now with the new FreshX store upgrades, chef-endorsed dinner kits. I don't know if you've seen it. It was such a clever idea. They actually had it in such a beautiful box. So they would say, tonight you're going to be making Korma chicken. And then they would have in this box the recipe. And they would actually have the chicken, the spices, the herbs, the mix, mushrooms, everything that you needed and you would have to buy for that day. Take it home and then make it up. I definitely made one. I think I made one about a year ago. A beef chow mein. So it's really take you out of your normal cooking of spaghetti bolognese every night or whatever the case is and trying to help you to be better at home. But also that it gives you everything in this box. They've got the Oh My Goodness range, which is a fresh range. And then they've also tools that they're busy implementing. They've developed their own private labels. We call it a house brand. You can call it private label, which is the simple truth. And that simple truth is really nice because as a mom, I know that it's going to be less sugar. So they really try and cater for kiddies lunches, but it's across the range. If you have a look at the aisle, please tell mom that you're going to be doing the shopping with them. You need to start going into the stores and looking what products they are and what the stores are offering. Please, it's going to help you with your paper too. So the simple truth, I know that they have vegetables. They've got cereals with different ingredients and everything is about less sugar, which is really, really nice. They've even got little biscuits that's got less sugar, chocolate biscuits and all sorts of things. ShopRite wants to take the African advantage. They're already in 15 countries, so a strategy would be that they were trying to get broad enough. And then a strategic footprint expansion. So they've got a distribution center. What is a distribution center? So the stores need to get their product from somewhere. So normally they have these huge distribution centers where all the suppliers will then deliver all the products, coffee, thin goods, spaghetti, milk, you name it, to this distribution center. ShopRite will then pack for the stores and then distribute to their stores. They've got a green star equipment in their distribution center. So there really is a big focus on going green, big focus on waste, on plastic bags. You can see that in the stores, on the environment. The stores, the retail industry really does have a big focus on that. Omni-channel shopping. So they've got various ways in which you can shop. You can go online or you can be delivered to or you can go in-store. So they really are trying to have you at every touchpoint possible. Checkers, I see that they've got this new 60-60 delivery where they deliver to you in 60 minutes, which is incredible because no one else is doing that at the moment. I know I tried to shop online for Woolies and they said to me, no, we'll deliver to you next week. So it's a problem if you need it now or tomorrow. It's okay if you're only needing stuff next week, but ShopRite has seen a gap in the market and they've said, right, we will deliver in 60 minutes, which is incredible. So problem-solving steps. You must know how to solve a problem. And in business problems. So the first thing you're going to do is you're going to identify what is the resource gap? What is the problem? What are we experiencing at the moment? And then you're going to start obtaining resources. So when I worked with Huggies, we were looking at bringing in Huggies toiletries, you know, to kind of be there with Huggies diapers or nappies, you know. Then understand the resource gap is we don't offer that at the moment. Elizabeth-Anne and Johnson & Johnson are offering that. Let's have a look at bringing that in. So the problem was that we wanted to expand our market. How are we going to expand our market? So we then started looking at how are we going to start obtaining those resources. And then you're going to start ensuring the supplies and cost, etc. So for example, Woolworths might now identify as a resource gap, they do not have same-day delivery. So now they start looking at how we're going to obtain the resources. Do we have our own delivery? Will we do it ourselves? Are we going to outsource it? Could we tie in with other delivery vehicles at the moment? Woolworths have done a very good job of outsourcing. They'll get to you anyway. You then need to, step two, is explain the impact on the business. So what would this have on the business? Because if we're going to have our same-day delivery, it's going to have a lot of costs involved. You're going to have to have a logistics manager. You're going to have to have a customer care person. You're going to have to have someone managing that website, shopping, and understanding that needs to be immediate. And then you're going to start considering solutions. What could we do to have the same-day delivery? In the beginning, you could say we could roll it out into just one area as a pilot area. So we just have two or three stores in that area and roll out slowly so that those three stores, any teething problems or learning that we needed to have. You're then going to, three, choose the best possible solution and explain it in breadth and depth. And now you're going into your analysis of how much it's going to cost, how you're going to do it. And you're going to take it step by step by step by step. You could use a decision tree chart, which I'm going to take you through. And that is where you have various branches. You could also look at a pros and cons chart when you're choosing the best possible solution so that you can make an informed decision. So strategies that are used to solve problems creatively. You have to know these strategies. Remember I said a strategy is a plan of action. It's how you're going to be solving anything in business strategies, plan of action, anything, any plan that you're going to do. And these are some of the tools that you can use. And again, it's the word tools that we're going to use. Remember you use tools in your micro environment, your macro environment, in your marketing environment. Here are some more that you can use to solve problems. The first one that we're going to look at is a pros and cons chart. We're then going to look at a decision tree, value chain analysis, PESTEL, SWOT, Delphi technique, resource-based approach, and your balance scorecard. Great job. Do you see the overlay? So I'm not going to go through the PESTEL in the last video. The SWOT, the resource-based approach, we've done all of this in the last video. We might just reiterate the balance scorecard because they always ask the balance scorecard. Okay, so let's get into it. Your pros and cons chart is exactly that. You're going to list it that you would have pros side and a cons side. Your pros are going to be why you're doing something. Oh, sorry, let me just. Right, so those are your pros and your cons. I beg your pardon, but I'm doing three things at the same time. What you're going to do is you're going to list all the pros. So for example, this is an example where it says the pros of a business partnership. Checkers is looking at going into a partnership with SPUR. For example, we're going to put SPURs in the checkers. So there's an extra set of hands, there's additional knowledge, there's reduced financial burden, less paperwork, fewer tax forms, whatever the case is, you're going to merge. Checkers and someone else is going to merge. You're going to list all the pros. You're going to list all the cons, and I'm sure you do this in your life anyway. The difference in business, what you've got to do, please, great old, you must rate these. So give a rating, a key out of five. Five being amazing and one being very weak. So an extra set of hands, a pro of a business partnership, I would rate that as probably a three. Yes, it's a good thing to have, although staff can do a lot, but there's an extra set of hands. Additional knowledge, I'd probably rate as a five, and yes, it's great to have that, and so on and so forth. You're going to rate your pros, rate your cons, and you're going to then add the score. And then you can see from a measurable point of view, which score is the highest, and whichever one is the highest, you can then go with, or you can then re-look. I don't agree with it. If your gut feels, you know, and I don't think we should be doing this, you can then go back and say, let's add in some more cons, because I really don't, or we're going to higher the rating, because I really don't think we should do this. So please don't forget your pros and cons. You must rate it. So you're going to have a rating of one to five. Five, yes, one being not so great. And then you're going to tally it up, and whichever one has the highest score is what you go, to make it measurable. Everything has to be measurable. Decision. So your decision tree is exactly that, it looks like a tree. So the question here, you put it in a little block, and normally your IT guys would use a decision tree quite a lot. You put it in a block, and you're going to say, should I buy any other clothes apart from the dress? This is now you making the decision. Yes or no are your questions. So yes, does the recommended product suit my eyes? Yes or no? Yes. Do I like the recommended product? Yes. Do I have money for anything apart from the dress? Yes or no? So you see no will then decline the offer, and that's how you go for. So for example, Checkers is looking at bringing in vegan, yes. Do we have enough people that are vegan in the area? Yes or no. Do we have enough products available? Do we have enough resources? And you're going to then do the little, and you will then decide and see where that decision tree takes you in order to make the decision. I have not seen this in an IAB paper. I have seen pros and cons, definitely. I have not seen, they haven't asked you to draw a decision tree just yet, but I think it's good just to practice. So ask yourself a question, and then you can start channeling off, and you're going to come up with all sorts of ideas, and you can see whether you're going to make that decision. It's just like it's a helpful tool to make a decision. You know the value chain analysis. Remember your primary activities and your secondary or support activities. Primary activities, we've said in checkers, trolleys, our till and our stock. And remember your value. How do I add value to those three things that are happening anyway? How can I be better with my trolley? How can I be better with my stock? How can I be better with my trolleys? And then your support or secondary activities is your marketing, HR. And how do I add value to marketing? We're going to launch a program, a customer relationship marketing program, where we've got a database, and we're going to start talking directly to customers. HR, we're going to do trading. That's how we're going to add value. So you can draw it out any way you want. Normally, you would be, you wouldn't do it as a table like this. You would actually just say primary activities, list the three, secondary activities, list, and submit. The Delphi technique. The Delphi technique, you can't draw it up, but they have asked this on numerous occasions in multiple choice or in where you've got to fill in the word. So basically a Delphi technique is where you get an expert. Okay, so let's go through. To facilitate six individual assessments from a pool of experts. So you're going to make a decision based on your experts. The experts will respond to the request. We want to bring in vegan deli. You're going to send it to experts. Send it to vegan association. You're going to send it to head office. You're going to send it to management, whatever. Experts in that field. Food technologists and things. They will then respond to the request. You will get and receive feedback. The facilitator will then, once they receive feedback, will compile the responses and send a revised set of questions to each expert. So now you're even going deeper into this solving the problem. There are several cycles that could take place and then you can make a decision. So the facilitator produces a report on the experts' responses. It's all about having experts giving you information to help you solve the problem. Delphi technique is about experts. The resource-based analysis. Remember, we've got a little acronym from the last video. Grant, values, carrots and strawberries. Grant being what's the gap in the market. And we see a resource gap and we say, you know, we see this gap. We want to bring in something. We're then going to ask, will it add value? What are our competitors? Do we have an advantage? Will there be a return on investment? And we then do our strategy. So again, it's a tool that you use to be better. To ask yourselves a question all the time. Do we have a competitive advantage? Are we better than our competitors? Balance scorecard. Remember, a balance scorecard is fickle, fickle, fickle. Nice to know how to do this. So even take a break now. Do a balance scorecard on SPAR. On SPAR, the retail store. So fickle financial. You're just going to list things in your financial. So you're looking at your budget. You're looking at your cash flow. It's very similar to a value chain analysis. Once you've got your financial things, you're going to say, can I add value? How do I add value to budgets? Maybe we're going to implement a system. Maybe we are keeping to our ratios, our industry ratios. And then you're going to mention current capital ratio is 2 to 1. The industry norm is 2 to 1. Just a refresher. You need 2 rand for every 1 rand that you owe is basically what it is. Okay, then you look at your assets ratio, which is 1 to 1. Why? Because you've taken out your stock, your trading stock in this equation. So it would be 1 to 1. We need 1 rand to cover 1 rand a piece. So that's financial. The I is internal processes. What could we do internally in SPAR? So we're going to look at our tool systems, our equipment. Let's upgrade our equipment. Let's upgrade our self-service. Let's implement a self-service where they can weigh their own veggies, put their own tags on, especially with COVID. People don't want anything touching in that. So we're going to do all of that. Right, then we're going to remember FICL, financial, internal. The C stands for customer. This is all about your customer. How are we going to make the experience better for the customer? How can we add value to our customer? Is there something more that we can do? So you might say, you know what, we're going to improve on our delivery. We're going to improve on the customer interaction with the tenants possibly. So maybe we do some training there. We're going to maybe have some more competitions, more promotions, and if we can help them because financially everybody is very strapped because people are losing their jobs, etc. The last one on the scorecard, FICL, learning, which is your, they call it education and growth, but it's learning and growth. So here again, you have to look in your business to say, we need to be better. How are we going to make our employees better? What kind of training programs could we send them on? Could we put them into a customer service? Could we also look after them? Could we say we're going to start Wellness Day, especially during COVID, especially our cashiers, and the guys on the floor that are dealing with this all the time. We're going to have a Wellness Day on a Wednesday morning. We're going to make them breakfast. They're going to have a lovely breakfast in the store, a little bit of training, and we're going to ensure that they are happy and comfortable and young. You could even do a pulse check with your internal staff, with your staff, pulse check to say, survey, how are you doing? What can we do? What do you need? So that every month, we're kind of making sure that we are checking, pulse checking our staff to make sure that they're happy. So any one of those strategies. Okay, so those are in a nutshell, that's chapter two, grade 12. How wonderful is that? So the new ones that you've got to know, if you remember, is your pros and cons. We're going to rate it and you're going to see whichever is higher. Decision tree, you know how to do a decision tree. You're just going to keep asking questions, and yes, no, yes, no, yes, no. You know your value chain. You know Delphi is helping you. That's a facilitator. So an expert, you're going to be sending your request to experts and they're going to come up with the information for you. Resource-based analysis, balance scorecard. And don't forget, you're also going to look at your PESTEL, your PORTIS, and SWOT analysis. Your SWOT is also a tool that you can use and be creative and thoughtful. Thank you. Have a good day.