2 Learning ObjectivesLO1 Summarize the basic steps in any planning process.LO2 Describe how strategic planning should be integrated with tactical and operational planning.LO3 Identify elements of the external environment and internal resources of the firm to analyze before formulating a strategy.LO4 Define core capabilities and explain why they provide the foundation for business strategy.
3 Learning Objectives (cont.) LO5 Summarize the types and choices available for corporate strategy. LO6 Discuss how companies can achieve competitive advantage through business strategy. LO7 Describe the keys to effective strategy implementation.
4 Decision Making Stages and Formal Planning Steps Figure 4.1
5 PlanningPlanningconscious, systematic process of making decisions about goals and activities that an individual, group, work unit, or organization will pursue in the future.a purposeful effort that is directed and controlled by managers and often draws on the knowledge and experience of employees throughout the organization.
6 Situational Analysis Situational analysis A process planners use, within time and resource constraints, to gather, interpret, and summarize all information relevant to the planning issue under consideration.
7 Alternative Goals and Plans The actions or means managers intend to use to achieve organizational goalsContingency planssets of actions to be taken when a company’s initial plans have not worked well or if events in the external environment require a sudden change
8 Goal and Plan Evaluation Managers will evaluate the advantages, disadvantages, and potential effects of each alternative goal and plan.Must prioritize those goals and even eliminate some of them.Managers must consider carefully the implications of alternative plans for meeting high priority goals.
9 Strategic Planning Strategic planning Strategic goals A set of procedures for making decisions about the organization’s long-term goals and strategiesStrategic goalsmajor targets or end results that relate to the long-term survival, value, and growth of the organization.
10 Strategic Planning Strategy A pattern of actions and resource allocations designed to achieve the organization’s goals