StrategicPlanning Chapter2LectureSlidesSolomon Stuart Carson SmithYournamehereCoursetitle numberDate ChapterLearningObjectives Whenyouhavecompletedyourstudyofthischapter youshouldbeableto ExplainthestrategicplanningprocessTellhowfirmsgainacompetitiveadvantageanddescribethefactorsthatinfluencemarketingobjectivesDescribethestepsinthemarketingplanningprocessExplainthefactorsinvolvedintheimplementationandcontrolofthemarketingplan IntroductiontotheTopic Organizationsrarelyplantofail buttheyoftenfailtoplan famousquote originunknown Theabovequotationspeakstotheimportanceofstrategicplanningandthepotentialconsequencesofdoingapoorjobatit Planninghelpsorganizations Tocopewithrapidlychangingfactorswithintheirenvironment Controlitsdestinythroughthesettingofobjectivesandtakingactionstoachievethem Toensurecoordinationofalldecisionmakingwithinitbyprovidingacommonvision TypesofPlanning Strategicplanning amanagerialdecisionprocessthatmatchesanorganization sresourcesandcapabilitiestoitsmarketopportunitiesforlongtermgrowthandsurvival Tacticalplanning adecisionprocessthatconcentratesondevelopingdetailedplansforstrategiesandtacticsfortheshorttermthatsupportanorganization slong termstrategicplan Figure2 1 TypesofPlanning continued Operationalplanning adecisionprocessthatconcentratesondevelopingdetailedplansforday to dayactivitiesthatcarryoutanorganization stacticalplans Cross functionalplanning anapproachtotacticalplanninginwhichmanagersworktogetherindevelopingtacticalplansforeachfunctionalareainthefirm sothateachplanconsidersobjectivesoftheotherareas Figure2 1 StrategicPlanning FirstStage Missionstatement aformalstatementinanorganization sstrategicplanthatdescribestheoverallpurposeoftheorganizationandwhatitintendstoachieveintermsofitscustomers products andresources Amissionstatementshould providedirectiontoallstakeholdersastowhytheorganizationexists beframedintermsthatareneithertoonarrowortoobroadrelatetoahigherpurposeotherthanjustprovidingareturntoshareholders matchobjectivestocapabilities berevisitedandupdatedastheorganizationchanges StrategicPlanning SecondStage SWOTanalysis ananalysisofanorganization sstrengthsandweaknessesandtheopportunitiesandthreatsinitsexternalenvironment Internalenvironment thecontrollableelementsinsideanorganizations includingitspeople itsfacilities andhowitdoesthingsthatinfluencetheoperationsoftheorganization Externalenvironment theuncontrollableelementsoutsideoftheorganizationthatmayaffectitsperformanceeitherpositivelyornegatively StrengthInternalfactorsPositive WeaknessInternalfactorsNegative OpportunityExternalfactorsPositive ThreatExternalfactorsNegative StrategicPlanning ThirdStage Objectives specificaccomplishmentsoroutcomesthatanorganizationhopestoachievebyaspecifictime ObjectivesaredevelopedfromthemissionstatementCanbeexpressedintermsof Performancemeasuressuchassalesrevenue profitability ROI marketshareProducttermssuchasinnovation industryleadership qualityCustomertermssuchassatisfactionSocialresponsibilityTobeeffective anobjectiveneedstopasstheSMARTtest Specific Measurable Attainable Realistic Time bounded TheBusinessPortfolio Strategicbusinessunits SBU individualunitswithinthefirmthatoperatelikeseparatebusinesses witheachhavingitsownmission businessobjectives resources managers andcompetitors Figure2 3 enlargedonnextslide Businessportfolio thegroupofdifferentproductsorbrandsownedbyanorganizationandcharacterizedbydifferentincome generatingandgrowthcapabilities Portfolioanalysis amanagementtoolforevaluatingafirm sbusinessmixandassessingthepotentialofanorganization sstrategicbusinessunits TheBusinessPortfolio Figure2 3 TheBCGGrowth MarketShareMatrix Questionmarks businessunitswithlowmarketsharesinhighgrowthindustries Alsoknownasproblemchildren thesebusinessunitscanberelativelynewtothemarketandgrowtobecomestarsordogs dependingontheirsuccessinachievingmarketshare Questionmarksneedcashtofueltheirgrowth Stars businessunitswithdominantmarketshareinhighgrowthindustries Thesebusinessunitsgeneratelargerevenues butstillneedlotsofcashtofueltheirgrowthandmaintainshare Theybecomecashcowswhenthemarketeventuallyslowsdown Figure2 4 TheBCGGrowth MarketShareMatrix Cashcows businessunitswithhighmarketsharesinlowgrowthindustries Thesebusinessunitsgeneratethecashneededtofundnewproductdevelopmentandfeedthequestionmarksandstars Cashcowsareprofitablebecausetheyhavebeenaroundlongenoughforthecompanytorecoveritsdevelopmentcosts Dogs businessunitswithlowmarketshareinlowgrowthindustries Thesebusinessunitsarethosequestionmarksthatdidnotachievesignificantmarketsharebeforethemarketsloweddown Theyaretargetsfordivestitureastheyjustcostmoneytomaintain Figure2 4 TheProduct MarketGrowthMatrix Marketpenetration growthstrategiesdesignedtoincreasesalesofexistingproductstocurrentcustomers non users andusersofcompetitivebrandsinservedmarkets Alsoknownasthe workharder strategy Marketdevelopment growthstrategiesthatintroduceexistingproductstonewmarkets Thiscanincludeexporting orfindingnewusesforexistingproducts Thebakingsodapeoplearever