Strategic planning

Strategic planning

1. Managerial process of creating and maintaining a fit between the organizations objectives and resources and the evolving market opportunity.

   • GOAL?
     • Long run profitability and growth.

2. Strategic business units

   • A number if very different businesses managed by large companies.
     • Properly SBU characteristics
       • A distinct mission and specific target market. Control over its resources. Its own competitor. A single business or a collection of related business. Plans independent of others SBU
     • Tools to manage the strategic direction of a company or SBU:
       • Ansoffs strategic opportunity matrix: market penetration: tries to increase market share among existing customers. Market development: attracting new customers to existing products. Product development: creation of new products for present markets. Diversification: increasing sales by introducing new products to new markets.
       • The Boston consulting group model: classifies each SBU by its present or forecast growth and market share, to balance the organizations or SBUs.
         • It has 4 categories
           • Cash cows: An SBU that generates more cash than it needs to maintain its market share. Problem children: also called a question mark, shows rapid growth but poor profit margins. Dogs: Low growth potential and a small margin market share.
             • After allocating SBUs in the matrix there are 4 strategies…
               • 1. Build: SBUs with potential to be a star, the organization uses its financial resources to achieve this goal. 2. Hold: If an SBU is successful cash cow, the goal is to held market share. 3. Harvest: For exception of the stars, the goal is to increase short term cash without concern 4. Divest: Getting rid of SBUs, often the problem children and dogs SBUs.
       • The general electric model: SBUs with low overall attractiveness should be avoided, these should be harvested or divest them. Highly attractive, thriving market plus a strong business position are the candidates for investment.

3. The marketing plan

   • Written document that acts as guidebook of marketing activities. Marketing plans for individual products, brands, lines, or customer groups.
     • Planning: process of anticipating future events and determining strategies for the future.
     • Defining the business mission: defining business in terms of goods and services rather than in terms of the benefits customers seek.
     • Conducting a situation analysis: SWOT analysis, identify its internal strengths and weaknesses and also examine external opportunities and threats.
     • Environmental scanning: collection and interpretation of information about forces, events, and relationships in the external environment that may affect the future of the organization or implementation of the marketing plan.
   • Planning: process of anticipating future events and determining strategies for the future.

4. Competitive advantage: set of unique features of a company and its product that are perceived by the target market as significant and superior

   • Product/service differentiation COMPETTETIVE ADVANTAGE: when a firm provides something that is unique and valuable to buyers beyond simply offering a lower price than that of the competition.
   • Niche competitive advantage: seeks to target and effectively serve a single segment of the market.
   • Sustainable competitive advantage: cannot be copied by the competition.
   • Market opportunity analysis (MOA): description and estimation of the size and sales potential of market segments that are of the interest to the firm and the assessment of the competitors in these market segments
   • Marketing mix: unique blend of product, place promotion and pricing strategies designed to produce mutually satisfying exchanges with a target market.

5. Marketing plan: implementation: process that turns a marketing plan into action assignments and ensures that these assignments are executed in a way that accomplishes that plans objectives. Evaluation and control, post audit tasks.