Rock Paper Scissor Tournament

STRATEGIC
MANAGEMENT PROCESS
1.4
Planning
Serves as a guide for making decisions
The act of setting goals, developing strategies, outlining tasks,
creating timelines

Each part of a business develops its own plan to guide its

operations
All plans must work together toward the business overall goals.
Importance of Planning
Most important function of management
The difference between higher profits or huge loses, expansion or
failure

All managers are involved with planning in some way

Deciding to expand and build a new building to deciding on work
schedules
Importance of Planning
Mangers use their plans to determine whether the business
is making progress

It encourages managers to be more specific in their

decisions

Planning in a large business is like a jigsaw puzzle. All the

pieces must work together
Coordination to avoid conflict & missed opportunities
Sharing plans between departments helps each see how their plans
effect another
Levels of Planning
Managers plan on two levels
Strategic planning (upper management)
Long term
Provides broad goals & direction for the entire business

Operational (mid-level management)

Short term
Identifies specific activities for EACH area of the business
 Setting Goals
You will never know when you have arrived if you dont know
where you are going.

Goal Is a specific statement of a result the business expects

to achieve

Characteristics of Effective Goals:

1. Specific & Meaningful 3. Clearly Communicated
2. Achievable (realistic) 4. Consistent with each other
and overall company
Operation Planning
Determines the:
How it will be done
Who will do it
What resources are needed to do it

Operational plans direct the day-to-day activities of a

business
Planning Tools
Budgets most widely used tool
Schedules deadlines
Standards Quality, Quantity, Time, Cost
Policies general rule for the whole business
Procedure steps followed to perform certain work
Research Gathering information
What is Strategic Management?
Application of the basic planning process
at the highest levels of the company
Top management sets goals for the
performance of the company
Carefully formulating, implementing, and
evaluating plans and strategies
What is Strategic Management?
Most important part is developing strategic plans
Plans must remain current as changes occur inside and
outside the company
Involves many levels of management
Top level formally develops basic plans
Different departments may be asked to develop plans
for their own areas
A solid plan guarantees that plans are coordinated and
are supported by everyone in the company
Strategic Management Approach
Three phases critical to the success of the
process
Formulation
Developing the strategic plan
Implementation
Putting the formulated plan to work
Evaluation
Continuously evaluating and updating the strategic
plan
Formulating Strategy
Developing the grand- and business-level
strategies to be used by the company
Companys strengths/weaknesses and
threats/opportunities shape the strategies
First step is to understand the current position of
the company
Identify mission, identify past and present strategies,
diagnose the companys past and present performance,
set objectives for the companys operation
Formulating Strategy
Identify the mission statement
Outlines why the company exists
Describes the companys basic products and/or
services and defines markets and sources of
revenue
Designed to accomplish several goals and
ensures a common purpose within the company
Identifying Past and Present Strategies
Companies need to understand and
appreciate their corporate history
Strategic managers should ask
Has past strategy been developed?
If not, can past history of the company be analyzed to
identify the strategy that has evolved?
If yes, has the strategy been recorded in writing?
Diagnosing Past and Present
Performance
A corporate planner must decide if past
strategies worked and if strategic changes
are needed by asking:
How is the company currently performing?
How has it performed during the past few
years?
Is the performance trend moving up or down?
Setting Goals
Concise statements that provide direction
employees and set standards for achieving
the companys strategic plan
Established in many areas (see handout)
Goals must be reevaluated as the
environment and opportunities change
Multiple goals are used to reflect the
desired performance
Policies, Procedures, and Rules
Policies are broad general guides to action
that establish boundaries within which
employees must operate
answering all written customer complaints in
writing within 10 days
Policies, Procedures, and Rules
Procedures are detailed series of related
steps/tasks written to implement a policy
Define methods through which policies are achieved
the customer service representative must note the
complaint of Form 622 and forward the yellow copy of
the form
Rules detail specific and definite corporate
actions that employees must follow
Leave little doubt about what is to be done
no smoking in the conference room
Implementing Strategy
Action stage of strategic management
Managers determine and implement the
most appropriate company structure,
motivate employees, develop short-range
goals, and establish functional strategies
Strategy must fit with current company
policies
Or conflicting policies must be changed
Evaluating and Controlling the Strategic
Plan
Process of continuously monitoring the
companys progress toward its long-range goals
and mission
Managers should ask:
Does the grand strategy need revising?
Where are problems likely to occur?
Basic strategy evaluation strategies:
Review external and internal factors that are the bases
for current strategies
Measure performance
Take corrective action
SWOT Analysis
Strengths, Weaknesses, Opportunities,
Threats
Process that allows companies to evaluate
overall health
Internal (SW) Can Control
External (OT) Cant Control
Most important result of a SWOT analysis is the ability to
draw conclusions about the attractiveness of the
companys situation and the need for strategic action
SWOT Analysis for Santa
Evaluating and Controlling the Strategic
Plan
Emphasis is making the companys
managers aware of the problems that are
likely to occur and of the actions to take if
they do arise
Plan ahead and avoid disaster
Strategic planning and evaluation should
be done on a predetermined schedule and
as frequently as necessary, determined by
internal and environmental factors