4 edited strat planning

7/31/2019 4 Edited Strat Planning

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Strategies, Policies andPlanning Premises

Strategy

Game plan


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Levels of Strategy


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Corporate

Strategy

BusinessStrategies

FunctionalStrategies

Levels of Strategy-Making


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Levels of Strategy1. Corporate-level Strategy

The set of strategic alternatives that an organizationchooses from as it manages its operationssimultaneously across several industries and severalmarkets.

2. Business-level Strategy

Howthe organization conducts business in a particularindustry.

3. Functional-level StrategyStrategy developed for specific functional areas

such as marketing, finance, and so forth.


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What is Strategic Planning?

Strategic planning is a systematic process

through which an organization agrees on

and builds commitment among key

stakeholders to priorities that are essentialto its mission and are responsive to the

environment.

Strategic Planning guides the acquisition andallocation of resources to achieve these

priorities.


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Strategic Planning

vs. Operational Planning Strategic Planning

formulation

What, where

ends

vision

effectiveness risk

Operational Planning

implementation

how

means

plans

efficiency control


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Three Big Strategic Questions Where Are We

Now?

Where Do we Wantto Go?

How Will We GetThere?


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Strategic Planning Process Developing a Vision and a Mission

Assessment Setting Objectives

Crafting a Strategy

Implementing and Executing Strategy Evaluating Performance, Reviewing the

Situation and Initiating Corrective Action


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Strategic Planning First Stage of Strategic

Planning may involve:

Futures Thinking

Thinking about what thebusiness might need to do1020 years ahead

Strategic Intents

Thinking about key strategicthemesthat will informdecision making


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Strategic Planning The Vision

Communicating to all staff where theorganisation is going and whereit intends to be in the future

Aims and Objectives:

Aims long term target Objectives the way in which you are

going to achieve the aim


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Strategic Analysis Constantly evaluate their position

Strategic analysis includes different methodsof assessing the current position of thebusiness in the market place

Two basic methods: Internal

External


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Internal Audits Productivity

Efficiency

Costs

Other Internal Data

Labour turnover, absenteeism

Customer satisfaction surveys Quality procedures

Cash flow statements

Sales trends

Skills audit Strengths and weaknesses analysis

Core competencies


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External Audits General business environment Inflation, competitiveness,

unemployment/employment, growth, consumer spending

Competitors

PEST factors

Political e.g. change of government

Economic Trends in economic growth, inflation, etc.

Social-changed outlook, age structure of population, etc.

Technological


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SWOTAnalysis

Strengths

Weaknesses

OpportunitiesThreats

Vision & Mission

An organizations fundamental purpose

Good Strategies

SWOT AnalysisTo formulate strategies that support the mission

Those that support the mission and:

exploit opportunities and strengths

neutralize threats

avoid weaknesses

Internal AnalysisStrengths(distinctivecompetencies)

Weaknesses Threats

External AnalysisOpportunities


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Strengths

Strengths Those things that you do well, thehigh value or performance points

Strengths can be tangible: Loyal customers,efficient distribution channels, very high qualityproducts, excellent financial condition

Strengths can be intangible: Good leadership,strategic insights, customer intelligence, solidreputation, high skilled workforce


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Weaknesses

Weaknesses Those things that prevent you fromdoing what you really need to do

Since weaknesses are internal, they are withinyour control

Weaknesses include: Bad leadership, unskilledworkforce, insufficient resources, poor productquality, slow distribution and delivery channels,outdated technologies, lack of planning, . . .


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Opportunities

Opportunities Potential areas for growth andhigher performance

External in nature marketplace, unhappycustomers with competitors, better economicconditions, more open trading policies, . .

Timing may be important for capitalizing onopportunities


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Threats

Threats Challenges confronting theorganization, external in nature

Threats can take a wide range bad presscoverage, shifts in consumer behavior, substituteproducts, new regulations, . . .

The more accurate you are in identifying threats,the better position you are for dealing with thesudden ripples of change


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Gap Analysis

Vision Assessment

Gap = Basis for Long-

Term Strategic Plan


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Setting Objectives The purpose is to

convert the mission intoSpecific PerformanceTargets

Yardsticks for trackingcompany progress andperformance.

Should be set at levelsthat require stretch anddisciplined effort.


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Crafting a Strategy


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Strategy Implementation

Technology

Human Resource

Reward System

Decision Process


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Characteristic of the GoodStrategy Implementation

An ongoing exercise Proper Communication

Contingency Plan

Emphasis on Organisation Culture Regular Review

Importance of Planning


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DECISION-MAKING


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What is Decision-Making?

Decision making

The process of choosing a course of

action for dealing with a problem or

opportunity.


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Types of Decisions

Programmed decisions.

Involve routine problems that arise regularlyand can be addressed through standard

responses.

Nonprogrammed decisions. Involve nonroutine problems that require

solutions specifically tailored to the situation at

hand


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Decision environments

Certain environments.

Risk environments.

Uncertain environments.


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Certain environments.

Exist when information is sufficient to

predict the results of each alternative in

advance of implementation.

Certainty is the ideal problem solving and

decision making environment.


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Risk environments

Exist when decision makers lack complete

certainty regarding the outcomes of

various courses of action, but they can

assign probabilities of occurrence.

Probabilities can be assigned through

objective statistical procedures or

personal intuition.


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Uncertain environments. Exist when managers have so little information

that they cannot even assign probabilities

.

Uncertainty forces decision makers to rely onindividual and group creativity to succeed in

problem solving.

Also characterized by rapidly changing:

External conditions.

Information technolo re uirements.


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Too Slow Too Quick

Procrastination

Indecision

Analysis paralysis

Ready, fire, aim Impulsive, compulsiveArbitrary

Range of decision making

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