The Role Of Marketing in Strategic Planning

Syndicate 3

Aim and Definition

Strategic Planning

…is the managerial process of developing and maintaining a strategic fit between the organization's objectives and resources and its changing market opportunities.

Org Objectives Resources

Changing Environment

Strategic Fit

Ideas defining Strategic Planning

•Managing a company’s business as an investment portfolio.

•Accessing accurately the future profit potential of each business.

•Underline strategic planning

Major Organizational LevelsCorporate Level:

Responsible for strategic planning of whole organization

Division Level:

Responsible for allocation of funds to each business unit’s strategic plan

Business Level:

Responsible for developing business unit’s strategic planning

Product Level:

Responsible for developing marketing plan to achieve objecties

Nature of Performance Business

•Stake Holder

A business must strive to satisfy minimum expectations of each stakeholder

•Processes

Companies build cross functional teams that manage core business process to be superior competitive

•Resources

Companies identify their core competencies and use them as the basis of strategic planning

•Organization

Companies align their organization’s structure/policies and culture to the changing requirement of the business strategy

Nature of Performance Business

ResourcesOrganisation

Processes

Stakeholders

satisfy minimum expectations of each stakeholder……….

……Improving critical business process……

…aligning resources and organisation

Dynamic relationship amongst stakeholders group in a high performance business

Stockholder satisfaction

Customer satisfaction

Higher quality Products and services

Higher quality environment (Employee satisfaction)

Growth Profit

Continuous improvement

Breakthrough innovations

Corporate Strategic Planning

Corporate mission

A corporate mission focuses on broad purposes of the organization and is a general criteria for determining long term organizational effectiveness.

source: Marketing Institute of Singapore

Elements of Defining Corporate Mission

•History

•Current Preferences of the owner

•Resources

•Distinctive competencies

Cont…

Examples of Corporate Mission

SINGAPORE AIRLINES is engaged in air transportation and related businesses. It operates world-wide as the flag carrier of the Republic of Singapore, aiming to provide services of the highest quality at reasonable prices for customers and a profit for the company.

Cont…

Examples of Corporate Mission

MARRIOTT’S Mission Statement:

We are committed to being the best lodging and food service company in the world, by treating employees in ways that create extraordinary customer service and shareholder value

Corporate Mission Statement

A mission statement provides company employees with a shared sense of purpose, direction and opportunity.

Characteristics and Focused Goals

•Industry scope

•Products and application scope

•Competencies scope

•Market segment scope

•Vertical scope

•Geographical scope

Strategic Business Unit

A set of products or product lines

• With clear independence from other products or product lines

• For which a business or marketing strategy should be designed

Source: Marketing Institute of Singapore

Establishing SBUs

Unique business mission

Definable set of competitors

Integrative planning done

independently

Responsible for resource

management in all areas

Large enough but not so large as to

become bureaucratic

(Source: Subhash Jain, Marketing Planning & Strategy, 6th Ed.)

Boston consulting group approach

A leading management consulting firm which was responsible for developing the growth- share matrix.

Growth-share matrix

•Question marks

•Stars

•Cash cows

•Dogs

Alternative objectives of SBU’s

•Build- To increase SBU’s market share, even

if it means to forego short term earnings.

•Hold- To preserve the SBU’s market share.

•Harvest- To increase SBU’s short term cash

flow, regardless of the long term effect.

•Divest- To sell or liquidate the business in

order to use the resources more efficiently.

Planning new businesses

1. Intensive growth opportunities-

• Ansoff product-market expansion grid.

• market penetration strategy

• market development strategy

• product development strategy

Cont…

Planning new businesses

2. Integrative growth opportunities-

• Backward integration

• Forward integration

• Horizontal integration

Cont…

Planning new businesses

3. Diversification growth opportunities -

• Concentric diversification strategy

• Horizontal diversification strategy

• Conglomerate diversification strategy

Business strategy planning

1. Business mission- defines specific goals and policies as a separate business.

2. External environment analysis-

• Macro environment forces- economic, political, socio-cultural.

• Micro – customers, competitors

• Opportunities- scope for company’s profitability.

• Threats-classified according to the seriousness & profitability of occurrence.

Cont…

Business strategy planning3. Internal environment analysis

-strength and weakness analysis.

4. Goal formulation-

• Hierarchical

• Quantitative

• Realistic

• consistent

Cont…

Business strategy planning

5. Strategy formulation-

• Overall cost leadership

• Differentiation

• Focus

6. Program formulation.

7. Implementation.

8. Feedback and Control.

Conclusion

Sun Tze on Strategy

“Know your enemy, know yourself, and your victory will not be

threatened. Know the terrain, know the weather, and your victory will be

complete.”-Marketing Institute of Singapore