Strategic Business Analysis

STRATEGIC PLANNING

STRATEGIC PLANNING
Strategic planning is important to an organization because it provides a sense
of direction and outlines measurable goals.
Strategic planning is a tool that is useful for guiding day-to-day decisions and
also for evaluating progress and changing approaches when moving forward.
What is planning?
Planning is deciding now, what we are going to do later, including how and when
we are going to do it, it is a forward looking. Without planning we cannot get anything
done efficiently and effectively. Successful companies practice market-oriented strategic
planning. The aim of strategic planning is to achieve targeted profits and growth in the
face of continual changing markets and environment.

Strategic planning includes making decisions about the company’s long-term

objectives and strategies. Planning is being done at three organizational levels

1. Corporate Strategic Plan

Corporate strategic planning is developed at the company’s headquarters to
guide the whole organization. The planning process includes four steps or
planning activities.
A. Developing corporate mission and objectives
B. Defining strategic business units (SBU’s)
C. Allocation of resources to SBU’s
D. Developing corporate strategies to fill the strategic planning gap.

2. Business Unit (or SBU) Strategic planning

Business Unit (or SBU) Strategic planning is done by the head of the business
unit by developing long term mission, objectives and goals, and strategies in the
changing environment.
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STRATEGIC PLANNING

3. Product/Operational Planning
 Product/Operational Planning is done for each product within a business
unit. It plans the specific procedures or systems required at lower level of
the organization.

 Operational managers normally develop plans for short periods of time (up
to one year). They focus on routine tasks such as sales, production,
material purchase, recruiting people, and dispatching goods.

 The functional plans like marketing, production, human resource, and

finance are developed by functional managers to carry out the routine task
on day-to-day basis.

THE ROLE OF MARKETING AND SALES

In most large and multi-product organizations, strategies are developed at
three organizational levels. These are:
1. Corporate Level
The role of marketing at corporate level is:
 to provide information on competition and customer – marketing
research, marketing share
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STRATEGIC PLANNING

 to advocate customer orientation and basic value of putting the

customer first as a part of long-term corporate strategy.

2. Business Unit
The role of marketing at business unit level is:
 to help develop long term business strategy
 provide competition and customer analysis
 developing “competitive advantage” strategy
 developing segmenting, targeting and positioning strategies

3. Functional Level
The role of marketing at functional level is:
 to evolve and implement marketing-mix strategies to achieve
marketing objectives
 coordinate marketing related activities
 allocate resources

MARKETING AND PERSONAL SELLING STRATEGIES

The key elements of marketing strategy are (a) target market strategy, and
(b) marketing mix strategy.
1. Target market strategy includes evaluating various market segments (or group
of customers) and deciding how many and which market segments to target. 

2. Marketing mix strategy consists of a set of marketing tools the company uses
to achieve its marketing objectives in the target market. McCarthy classified
these tools into four broad groups that he called four Ps of marketing – Product,
Place, Promotion and Price.
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STRATEGIC PLANNING

Out of the four marketing mix strategies, the promotion or marketing

communication strategy has five components: sales promotion, advertising,
public relation of publicity, personal selling, and direct marketing.

Many companies consider either advertising or personal selling as the main tool
and other components such as sales promotion, public relations, publicity and
direct marketing, as supplemental tools. However, a better approach is to move
towards “Integrated Marketing Communications.”

INTEGRATED MARKETING COMMUNICATION (IMC)

The concept of IMC is increasingly used by many firms. It is the strategic
integration of a variety of communication tools such as advertising, sales promotion,
personal selling, public relations, publicity and direct marketing.
The objectives of IMC are:

 to use the most cost-effective tools to achieve and desired communication

objectives
 to ensure strong message consistency, clarity and sales impact.

To achieve these objectives, the following action points are suggested:

1. The company should appoint a head of communication
2. The company should build a database by measuring the results after
implementation of promotional plan in comparison with the communication goals,
the promotional media cost and the message consistency.
3. Conduct training program for all persons handling various communication tools.