How is Strategic Planning carried out at

different Levels of

the Organization?

These slides are based on Chapter 2 of ‘Marketing Management’ by Kotler Keller

All corporate headquarters undertake 4 Planning Activities

1. Defining the corporate mission

2. Establishing strategic business units

3. Assigning resources to each strategic business unit

4. Assessing growth opportunities

1. Defining the Corporate Mission

Mission statements - Reflects a vision, an almost “impossible dream” that provides direction for the next 10 to 20 years

Characteristics of Good Mission Statements

Focus on a limited number of goals

Stress the company’s major policies and values

Define major competitive spheres within which the company will operate

Take a long-term view

As short, memorable, and meaningful as possible

2. Establishing Strategic Business Units

Single business, or collection of related businesses, that can be planned separately from the rest of the company

Has its own set of competitors

Has manager responsible for strategic planning & profit performance, who controls most of the factors affecting profit

3. Assigning Resources to Each SBU

Decide how to allocate resources to each business unit

4. Assessing Growth Opportunities

# Intensive Growth

# Integrative Growth

# Diversification Growth

# Downsizing And Divesting Older Business

# Intensive Growth

Review of opportunities for improving existing business

# Integrative Growth

Company can increase sales and profits through backward, forward, or horizontal integration within its industry

# Diversification Growth

When good opportunities exists outside the present business , then company may look forward to starting a new business

# Downsizing And Divesting Older Business

Companies carefully prune, harvest, or divest tired old businesses to release needed resources for other uses and reduce costs

Business Unit Strategic Planning

Fig. :-The Business Unit Strategic-Planning Process

Business Unit Strategic Planning

# The Business Mission

# SWOT Analysis

# Goal Formulation

# Strategic Formulation

# Program Formulation &Implementation

# Feedback and Control

# The Business Mission

Each business unit needs to define its specific mission within the broader company mission

# SWOT Analysis

# Goal Formulation

Arranged hierarchically, from most to least important

Objectives should be quantitative whenever possible

Goals should be realistic

Objectives must be consistent

# Strategic Formulation

Overall Cost Leadership – Lowest Production & Distribution Cost

Differentiation – Superior Performance

Focus – Concentrate on Narrow Market Segments

# Program Formulation and Implementation

Strengthen R&D Department

Gather Technological Intelligence

Develop Leading-Edge Products

Train Technical Sales Force

Communicate to Technological Leadership

# Feedback and Control

Organisation should examine the changing environment and adopt new goals and behaviours

Organization fails to respond to a changed environment, it becomes increasingly hard to recapture its lost position

Thus,

Once,

R E F E R E N C E Shttp://blogs-images.forbes.com/work-in-progress/files/2011/05/Bullseye-Red-Red.jpg

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http://stratdevint.com/images/globe.jpg

http://www.vindhyavasinigroup.com/images/vision-mission-big.jpg

http://www.catdi.com/wp-content/uploads/2013/08/banner-mission.jpg

http://www.thecbg.it/images/sustainable-future2.jpg

http://worldpayment-solutions.com/images/images/iStock_000009804777Large.jpg

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