Strategic planning

Amity business School Noida

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Mamta Mohan

Strategic planning

Perspecti e o! Planning" #o$ to ma%e a Marketing plan.

05/13/10

Mamta Mohan

&orporate and di ision strategic planning"

' Define the corporate mission '' (stablish S)*s Assign resources to S)*+s , )&- Matri. , -( model , S/01 Analysis ''' Assessing growth strategies" , Strategic planning gap , 3 intensi e gro$th strategies 2 Anso!!+s product mar%et (.pansion -rid3
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Mar%eting Planning5 1he )asics !or Strategy and 1actics

Planning: Process o! anticipating !uture e ents and conditions and o! determining the best $ay to achie e organi6ational goals Marketing planning: 'mplementing planning acti ities de oted to achie ing mar%eting ob7ecti es
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 Strategic Planning versus Tactical Planning

8 Strategic planning: Process o! determining an organi6ation+s primary ob7ecti es and adopting courses action that $ill achie e those ob7ecti es 8 Tactical planning: Process that guides the implementation o! acti ities speci!ied in the strategic plan"
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 Strategic Planning versus Tactical Planning

8 Top management
-reater proportions o! their time engaged in planning *sually !ocus their planning acti ities on long, range strategic issues

8 Middle level managers

:ocus on operational planning; creating and implementing tactical plans

8 Supervisors
<e eloping the speci!ic programs to meet goals in their areas o! responsibility
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Steps in the Mar%eting Planning Process

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(lements o! strategic mar%eting planning

Corporate mission

opportunities

ob ectives

!esources

Corporate " S#$ strateg% Marketing ob ective Marketing strategies Selection of target market Marketing mi& decisions
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Defining the corporate mission.

@ the purpose o! Motorola is to honorably ser e the needs o! the communityA by pro iding products and ser ices o! superior Buality" At a !air price to our customer"A to do this so as to earn adeBuate pro!its"A $hich is reBuired !or the total enterprise to gro$" and by so doing pro ide an opportunity !or our employees and shareholders to gro$ to achie e the reasonable personal ob7ecti es"

'n fos%s technologies limited @to achie e our ob7ecti es in an en ironment o! !airnessA honesty and courtesy to$ards the clientsA employments endors and society at large"C ()ba% D /e help people trade practically any thing on earth" /e $ill continue to enhance the online trading e.perience o! all collectorsA dealers A smaller businessA uniBue item see%ersA bargain hunters A opportunity sellers and bro$sers"
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1o de!ine mission
1o de!ine mission 8 address D /hat business are $e inCA /ho is our customerE /hat is the alue to the customerE they are best $hen they re!lect the ision, an impossible dream

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3 ma7or characteristics,Mission
3 ma7or characteristics 1hey !ocus on limited Number o! goals" Stress the company+s ma7or policies and alues" 1hey de!ine the ma7or competiti e sphere" in terms o! industryA Products and applications" competenceA Mar%et segmentA Fertical A geographical
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<e!ining the business

compan% Gero. Product definition /e ma%e copying instruments /e sell (ncyclopedia Market definition /e help impro e o!!ice producti ity /e distribute in!ormation

(ncyclopedia )ritannica carrier

/e ma%e air /e pro ide conditioners and climate control at !urnaces home"
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(stablish S)*s
1he purpose is to de elop separate strategies and assign appropriate !unding"

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Methods !or Mar%eting Planning

#usiness Portfolio Anal%sis
8 Strategic #usiness $nits 2S)*s3 are %ey business units $ithin di ersi!ied !irms
A di isionA product lineA or single product may de!ine an S)* :irms redesign their S)*s as mar%et conditions dictate

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 The #C* Matri&

8 Market Share+ Market *rowth Matri&5 a mar%eting planning tool that classi!ies a !irm+s S)*+s or products according to industry gro$th rates and mar%et shares relati e to competing products
Stars &ash &o$s <ogs Huestion Mar%s

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&orporate and <i ision Strategic Planning

The Boston Consulting Groups GrowthShare Matrix

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)&- Mar%et Share/Mar%et -ro$th Matri.

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,. Stars 2Ihigh gro$thA high mar%et share3 , use large amounts o! cash and are leaders in the business so they should also generate large amounts o! cash" -. Cash Cows 2Ilo$ gro$thA high mar%et share3 , pro!its and cash generation should be high A and because o! the lo$ gro$thA in estments needed should be lo$" Jeep pro!its high , :oundation o! a company .. Dogs 2Ilo$ gro$thA lo$ mar%et share3 , a oid and minimi6e the number o! dogs in a company" , be$are o! e.pensi e Dturn around plans+" , deli er cashA other$ise liBuidate /. 0uestion Marks 2I high gro$thA lo$ mar%et share3 , ha e the $orst cash characteristics o! allA because high demands and lo$ returns due to lo$ mar%et share , i! nothing is done to change the mar%et shareA Buestion mar%s $ill simply absorb great amounts o! cash and laterA as the gro$th stopsA a dog" , either in est hea ily or sell o!! or in est nothing and generate $hate er cash it can" 'ncrease mar%et share or deli er cash

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 The 1our strategies that can be pursued. #uild 2 increase market share 3old) preserve market share 3arvest) increase short term cash flow Divest) to sell and li4uidate

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<isad antages
#igh mar%et share is not the only success !actor Mar%et gro$th is not the only indicator !or attracti eness o! a mar%et

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Assessing the S)*+s

1he -eneral (lectric Matri.

1he -( Matri. o ercomes a number o! the disad antages o! the )&- " :irstlyA market attractiveness replaces market growth as the dimension o! industry attracti enessA and includes a broader range o! !actors other than 7ust the mar%et gro$th rate" SecondlyA competitive strength replaces market share as the dimension by $hich the competiti e position o! each S)* is assessed"
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&orporate and <i ision Strategic Planning

MarketAttractivenes s Portfolio Strategies

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&orporate and <i ision Strategic Planning

Market-Attractiveness Portfolio Strategies

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:actors that A!!ect Mar%et Attracti eness

, Mar%et Si6e
, Mar%et gro$th , Mar%et pro!itability , Pricing trends , &ompetiti e intensity / ri alry , 0 erall ris% o! returns in the industry , 0pportunity to di!!erentiate products and ser ices , Segmentation , <istribution structure 2e"g" retailA directA $holesale

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:actors that A!!ect &ompetiti e Strength

)Strength of assets and competencies ) !elative brand strength ) Market share ) Customer lo%alt% ) !elative cost position 5cost structure compared with competitors6 ) Distribution strength ) !ecord of technological or other innovation ) Access to financial and other investment resources
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S78T Mamta Mohan Anal%sis

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Planning 9ew #usiness

'! 1here is a strategic gap bet$een !uture desired sale K pro7ected sales then corporate has to plan ne$ )usiness" 1hree 0ptions are a ailable 'ntensi e -ro$th 'ntegrati e -ro$th <i ersi!ication -ro$th
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'ntensi e -ro$th
Current Products 9ew Products

Current Market

Market Penetration Strateg%

Product Development Strateg%

9ew Market Market Development Diversification Strateg%

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'ntegrati e -ro$th
)ac%$ard 'ntegration :or$ard 'ntegration

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<i ersi!ication -ro$th

&oncentric <i ersi!ication 2 Synergies $ith e.isting Product Line3 #ori6ontal <i ersi!ication 2 Ne$ Product $ith appeal to 0ld customers3 &onglomerate <i ersi!ication 2 Ne$ product $ith no relation to the current products or technology3

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Success!ul Strategies5 1ools and 1echniBues

All planning strategies ha e the goal o! creating a sustainable competitive advantage !or a !irm" An ad antage $here other companies cannot pro ide the same o!!ering or alue"
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Porter:s 1ive 1orces Model

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 1irst Mover and Second Mover Strategies

8 1irst mover strateg%5 1heory ad ocating that the company that is !irst to o!!er a product in a mar%etplace $ill be the long, term mar%et $inner" 8 Second mover strateg%5 1heory that ad ocates obser ing closely the inno ations o! !irst mo ers and then introducing ne$ products that impro e on the original o!!ering to gain ad antage in the mar%etplace"
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Porters generic strategies

0 erall cost leadership <i!!erentiation :ocus

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)usiness Strategic Planning

Differentiation

1ocus

Porter:s *eneric Strategies

8verall cost leadership

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)usiness Strategic Planning

Travelocit%:s 7eb site helps users plan the entire trip )) flights; lodging; and car rental.

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Mamta Mohan

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Strategic alliances
Product ser ice alliance Promotional Alliance Logistics Alliance Pricing &ollaborations"

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Mamta Mohan

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#usiness plan
&ontents o! mar%eting plan (.ecuti e summary Mar%eting strategy :inancial Strategy 'mplementation &ontrol

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Mamta Mohan

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)usiness Plan/ mar%eting plan

&urrent mar%eting situation 0pportunity K issue analysis 0b7ecti es Mar%eting strategy Action Programs :inancial pro7ections 'mplementation K &ontrols"
Mamta Mohan 3?

05/13/10

Mecap
Perspecti e o! Planning" #o$ to ma%e a Marketing plan. Define the corporate mission '' (stablish S)*s Assign resources to S)*+s , )&- Matri. , -( model , S/01 Analysis ''' Assessing growth strategies" , Strategic planning gap , 3 intensi e gro$th strategies 2 Anso!!+s product mar%et (.pansion -rid3

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Assignment
select a di ersi!ied 'ndian company collect in!ormation about its businessesA &omment on missionA suggest ho$ many business units" And S$ot analysis Ma%e a business plan !or the business you $ant to ta%e up"

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