planning & strategy1

8/7/2019 Planning & Strategy1

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Planning & Strategy


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Planning the conscious, systematic process of

making decisions about goals andactivities to be pursued in the future

importance of formal planning hasgrown dramatically


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An Overview Of PlanningFundamentals (cont.)

Basic planning process (cont.) Step two: alternative goals and plans

generate alternative future goals and plans to achieve them goals - targets or ends the manager wants to reach

should be specific, challenging, and realistic plans - the actions or means intended to achieve goals

identify alternative actions, needed resources, and potential obstacles single use plans - designed to achieve goals that are unlikely to be

repeated in the future: Projects, budgets, program standing plans - designed to achieve an enduring set of goals: Policies,

SOPs, rules contingency plans - actions to be taken when initial plans fail


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Basic planning process (cont.) Step three: goal and plan evaluation

evaluate the advantages, disadvantages, andpotential effects of each alternative goal and plan

prioritize those goals consider the implications of alternative plans

Step four: goal and plan selection identify the priorities and trade-offs among goals and

plans leads to a written set of goals and plans that are

appropriate and feasible within a predicted set of circumstances


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Basic planning process (cont.) Step five: implementation

plans are useless unless they are implemented properly managers must understand the plan, have the necessary

resources, and be motivated to implement it Step six: monitor and control

must continually monitor the actual performance inrelation to the goals and plans

develop control systems to take corrective action


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Identifying anddiagnosing the problem

Generating alternativesolutions

Evaluatingalternatives

Making thechoice

Implementing

Evaluation

Situationalanalysis

Alternativegoals and plans

Goal andplan evaluation

Goal andplan selection

Implementation

Monitor and

control

General d ecis ion-

maki ng stage

s Spec ific fo

rma l

plann ing step s

Decision-Making Stages AndFormal Planning Steps


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Levels Of Planning

Strategic planning decisions of senior executives about the

organizations long-term goals andstrategies

has an external orientation covers major portions of the organization strategic goals - major targets that

relate to the long-term survival, value, andgrowth of the organization

strategy - pattern of actions and resourceallocations designed to achieve the goalsof the organization

matches the skills and resources of theorganization to the opportunities found in theexternal environment


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Levels Of Planning (cont.) Tactical planning

translates broad strategic goals and plans intospecific goals and plans that are relevant to adefinite portion of the organization

focuses on the major actions that a unit must taketo fulfill its part of the strategic plan Operational planning

identifies the specific procedures and processesrequired at lower levels of the organization

plans intended for short periods of time and focuson routine tasks


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Levels Of Planning (cont.) Strategic, tactical, and operational plans

must be consistent and mutuallysupportive.

The three levels of goals can be seenforming a hierarchy. Each level must besynchronized so all efforts are focused onachieving organizational goals.


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Strategic management strategic management - involves

strategic planning and managementinto a single process


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Strategyimplementation

Strategiccontrol

Establishmentof mission,vision, and

goals

Analysis of external

opportunitiesand threats

Analysis of internal

strengths andweaknesses

SWOT analysisand strategyformulation

The Strategic ManagementProcess


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Strategic ManagementProcess

Step 1: establishment of mission, vision, andgoals

mission - basic purpose and values of theorganization

defines the scope of operations states the organizations reason to exist written in terms of the general clients served by the

organization strategic vision - provides a perspective on

where the company is headed and what the

organization can become moves beyond the mission statement strategic goals - evolve from the mission and

vision of the organization need to be communicated to everyone who has contact

with the organization


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IMCs Vision and Mission "IMCs Vision is to be the most respected and successful enterprise,

delighting customers with a wide range of products and solutions in theautomobile industry with the best people and the best technology".

The most respected. The most successful.

Delighting customers. Wide range of products. The best people. The best technology.

Mission of Toyota is to provide safe & sound journey. Toyota is developingvarious new technologies from the perspective of energy saving anddiversifying energy sources. Environment has been first and mostimportant issue in priorities of Toyota and working toward creating aprosperous society and clean world.


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1: Developing Mission and Vision:Vision

Aga Khan University (AKU) will be an autonomous,international institution of distinction, primarilyserving the developing world and Muslim societiesin innovative and enduring ways.Mission

AKU is committed to the development of humancapacities through the discovery and disseminationof knowledge, and application through service.


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Strategic Management Process(cont.)

Step 2: analysis of external opportunities andthreats

successful strategic management depends on anaccurate and thorough evaluation of the environment

stakeholders - groups and individuals who affect andare affected by the achievement of the organizationsmission, goals, and strategies

forecasting future trends is critical must develop a clear sense of market opportunities

identify potential threats as well difference between an opportunity and threat may depend on

how a company positions itself strategically


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Elements Of EnvironmentalAnalysis

Socialanalysis

Human resourcesanalysis

Industry andmarket analysis

EnvironmentalAnalysis

Competitor

analysis

Technological

analysis

Macroeconomicanalysis

Political and

regulatory analysis


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Step 3: analysis of internal strengths andweaknesses

Resources - inputs to production that can beaccumulated over time to enhance the performance

of the firm may be tangible or intangible assets provide a competitive advantage if:

the resource is instrumental in creating customer value the resource is rare and not equally available from other sources resource is difficult to imitate

resource is well organized Core competence - something a company does

especially well relative to its competitors usually a set of skills or expertise in some activity


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Internal Resource Analysis

Marketing auditOperationsanalysis

Financialanalysis

InternalResourceAnalysis

Human resourceassessment

Other internalresource analysis


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Step 4: SWOT analysis and strategyformulation

SWOT analysis - comparison of strengths,

weaknesses, opportunities, and threats helps summarize the major facts and forecasts

derived from external and internal analyses used as the basis for identifying primary and

secondary strategic issues confronting theorganization


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Step 4: strategy formulation (cont.) Corporate strategy - identifies the set of

businesses, markets, or industries in which theorganization competes and the distribution of

resources among those businesses. Strategy foroverall growth and development of the business. concentration strategy - focuses on a single business

competing in a single industry vertical integration - expands the domain of the

organization into supply channels or to distributors concentric diversification - moving into businesses that

are related to the companys original core business conglomerate diversification - expands into unrelated

businesses



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Business strategy - defines the majoractions used to build and strengthencompetitive position

low-cost strategy - attempt to be efficient and

offer a standard product useful for companies that are large and take advantage of economies of scale in production or distribution

organization must be the cost leader in its industry must offer a product that is acceptable to customers

differentiation strategy - attempt to be unique in

its industry or market segment along somedimensions that customers value position based on high product quality, excellent marketing and

distribution, or superior service


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Step 4: strategy formulation (cont.) Functional strategy - implemented by each

functional area of the organization to supportthe business strategy

ensures that departments operate in a manner that isconsistent with business strategies

Step 5: strategy implementation organizations adopting a comprehensive view

of implementation organizations applying a participative strategicmanagement process to implementation


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Galbraith has suggested severalthings to put strategy into practice

Technology: Strategy must be supported by Tech. Human resource: People must have required

skills, require Strategic HR Planning Reward System: Tangible and Intangible for

motivation.

Decisions Process: means to resolve problemsand questions. Structure: clarity and coordination.


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MBO Management by objectives (MBO) is a systematic and organized

approach that allows management to focus on achievable goalsand to attain the best possible results from available resources.

According to Drucker managers should "avoid the activity trap",getting so involved in their day to day activities that they forget

their main purpose or objective. Instead of just a fewtop managers , all managers should:

participate in the strategic planning process, in order to improvethe implementability of the plan, and

implement a range of performance systems, designed to help the

organization stay on the right track.
http://www.1000ventures.com/info/executive_smart_brief.htmlhttp://www.1000ventures.com/business_guide/crosscuttings/planning_strategic.htmlhttp://www.1000ventures.com/business_guide/crosscuttings/planning_strategic.htmlhttp://www.1000ventures.com/info/executive_smart_brief.html


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