Strategic Planning - Janet L. Belch

Strategic Planning In a Competitive Marketplace Strategic Planning Process Necessary for large corporations to survive & prosper Budget/Forecast oriented planning is no longer enough Strategic Planning Defines objectives Assesses internal & external situation

Strategies formulated & implemented based on actual situation Evaluation leads to adjustments to stay on track The Planning Process Mission & Objectives Environme ntal Scanning Strategy Formulatio n Strategy Implement ation Evaluation

& Control The Sigmoid Curve Typical Life Cycle The Secret to Constant Growth: (Start a New Life Cycle) The Mission & Objectives Mission Statement - Describes the Companys Business Vision Unchanging values Purpose of company Visionary goals that guide the pursuit of

future opportunities Objectives guided by companys vision Measurable financial & strategic objectives Ex: Sales targets, market share, reputation Environmental Scan Includes the following:

SWOT Analysis Strengths/Weaknesses Industry Analysis PEST Analysis (Political, Economic, Social, Technological) Competitive Analysis Rivalry Threat of Substitutes Buyer Power

Supplier Power Barriers to Entry/Threats to Entry Strategy Formulation Given environmental conditions, Match strengths to opportunities identified Address weakness and external threats Competitive Advantage - How will you gain an advantage over your competition? Cost

Leadership Strategy low cost producer Differentiation Strategies Focus Strategies - segmenting Strategy Implementation Implementation - programs, budgets, and procedures to be used Implementation involves: Organization of company resources Motivation of staff to achieve objectives Usually different people than those who formulate the strategies

How strategies are implemented can have a significant impact on success Executives must communicate strategies effectively & reasons behind them Evaluation & Control Implementation of strategies must be monitored and adjusted if needed Evaluation & Control Process 1. 2.

3. 4. 5. Define parameters to be measured Define target values for those parameters Perform measurements Compare measured results to the pre-defined standard Make necessary changes