Chapter Three - Strategic Market Planning
Business Planning
: A roadmap that includes decisions to guide the entire organisation : Planning is at 3 levels: . Strategic (top level, long range, overarching)
o Operational (supervisory level, day to day execution of tactical plans)
Strategic Planning Tactical Planning Operational Planning Corporate Level Planning Strategic Business Unit (SBU) Planning Planning done by Planning by Functional Area Managers: Supervisory Managers: Planning done by top Planning done by top Human Resources Communication manage Finance level SBU managers Sales manager level corporate managers Operations Merchandising manager Defining corporate Define the business Accounting Marketing research visions mission Marketing manager Setting corporate Evaluate the Evaluate the marketing Develop action plans goals environment environment to implement tactical Establish the (SWOT analysis) .Set marketing plans business portfolio State business objectives objectives Develop marketing Develop growth strategies to achieve strategies corporate objectives
Strategic Planning
The managerial decision process that matches the organisation's resources and capabilities to its market opportunities for long-term growth . Top management defines mission & sets objectives . May have separate strategic business units
Functional Planning
: Functional - planning done by top functional level management : Market planning includes: o Situation analysis . Broad 3 - 5 year plan to support the strategic plan . Annual plan
Operational Planning
* First-line managers focus on day-to-day execution of functional plan : For marketers, this typically includes
implementation
- Use of marketing metrics to monitor performance
Strategic Planning at the Corporate Level
: Defining the Organisation's Mission Establish Corporate Objectives : Allocate Resources to the SBUs
All Business Planning is an Integrated Activity
: Strategic, functional, and operational plans must be in harmony for firm to succeed - Planning at all levels flows from organisation mission : Planners at all levels must keep the "big picture" in mind
Steps in Strategic Planning
1. Define the Mission - A mission may begin with these questions: - What business are we in? - What customers should we serve? - How should we develop the firm's capabilities and focus its efforts? o A mission statement is a formal document that describes the firm's overall purpose and what it hopes to achieve in terms of its customers, products, and resources o What the firm is offering w.o being too broad, narrow, or short-sighted 2. Evaluate the Internal & External Environment : SWOT Analysis . Internal Environment (Firm's resources, competencies, people and processes) -> controllable elements : strengths weaknesses : E.g. key technologies, patens. Financial stability, supplier relationships reputation, human capital - External'Environment (economic, competitive, technological, legal sociocultural) -> beyond control - Opportunities : Threats 3. Set Organisational or SBU Objectives o Should be redirect outgrowth of the mission statement - Taking into account internal and external environmental factors o Objectives should be specific, measurable, attainable, and sustainable . Control is only possible by comparing actual performance against clear objectives! 4. Establish the Business Portfolio . A business portfolio represents the range of different businesses that a large firm operates o Portfolio a