TAC has developed a specific methodology and an in-depth expertise in realizing such country-strategy studies. The methodology is based on the following steps:

• Identification of the key issues for the country’s medium- to long-term development, ranging from economic policies to political issues and social development. These key issues are grouped in order to define a couple (from 2 to 5) of “archetypal” scenarios covering a large spectrum of “potential future developments”.

• Construction of a quantitative instrument designed to ensure a strong internal coherence for each scenario; such quantitative tools usually rest on standard econometric estimation able to relate the key issues to the fundamental economic variables needed for the strategic appraisal.

• Identification of the economic results that are only marginally affected by the passage from one scenario to the other, which we call the “anchor points”, or the most solid and invariant elements on which the global strategic decisions can rest; symmetrically, the variables that exhibits radically different values when moving from one scenario to the other are called the “risk areas”, and the studies look at the possible way to mitigate or manage such risks. Indeed, TAC considers that the artificial setting of probabilities to each scenarios is a severe reduction of the information content of the scenario construction exercise, and that, conversely, the ability to properly identify such anchor points and risk areas offer a much more powerful background for strategic decision making.

• The unfolding of the macro scenarios down to the specific industry of the customer, here again through a combination of qualitative analysis and quantitative estimation and coherence building. The output of this step of the country strategy studies allows to go down to the specific nature of the customer’s demand factors and competition issues.

• Last but not least, the country strategy studies can look at the different strategic options available and initiate the evaluation process for each option, including valuation of potential targets, cost estimates and stress testing on final corporate results.

The realization of such country strategy studies is usually based on an “in-house” team of 2 to 4 economists, occasionally completed by an outside / independent expert on the specific industry or sector of the customer if we feel that such industry expertise is required. Such studies always require at least 2 trips on the field, and a very close cooperation and dialogue with the team in charge of the strategic decision within our customer. Cost is obviously very dependent on the specific requests for each study, but would usually be between 40 K€ and 100 K€. TAC’s flexibility allows to define a timeframe for such studies that fit exactly with each customer’s specific requirements in its own decision process. Past experience has shown that a minimum of about 3 months is required for such studies.