In today’s fast-paced business world, the ability to effectively manage the marketing process from the beginning to the end has become an extremely important source of competitive advantage. While marketing plan is essential part of the marketing process, high-performing firms hone their expertise in organizing, implementing, and controlling marketing activities as they follow marketing results closely, diagnose problems, and take corrective action when
necessary. Furthermore, firms respond to dynamic market place through careful planning and management of the marketing process.
Meaning of Strategic Planning
Strategic planning is a step-by-step process of envisioning a desired future and translating this vision into broadly defined goals and objectives to that enables the realization of the vision. It begins by establishing the desired end and retrospectively working towards the current status of the firm. The planner is mainly concerned with what must be done to at the lower stage to reach the higher stage. Market-oriented strategic planning is the managerial process of developing and maintaining a viable fit among the organization’s objectives, skills, and resources and its
changing market opportunities. The aim of strategic planning is to shape the company’s businesses and products so that they yield target profits and growth and keep the company healthy despite any unexpected threats that may arise. Kotler emphasis that strategic planning requires action in three key areas. The first area is managing a firm’s businesses as an investment portfolio. Second, the firm needs to evaluate each business strength by considering the market’s growth rate and the company position and fit in the market. The area is development of strategy,
which refers to a game plan for achieving long-term objectives.
Strategic planning process begins at the corporate level of management, who prepares the mission and vision statement, policy, strategy, and goals. The corporate level managers establish a framework within which the divisions and business units will prepare their plans. In other organizations, corporate level managers set goals for their business units wand allow them to develop strategies of achieving them, while others leave the whole responsibility to business units. Regardless of the level of involvement, it is important to note that all strategic plans are based on corporate mission.
The Strategic Planning Process
The strategic planning process follows the following steps
Definition of Corporate Mission
- Environmental Analysis
- Strategy Formulation
- Strategy implementation
- Strategy institutionalization
- Evaluation and Control
Definition of Corporate Mission Statement
The mission statement declares the purpose of organization existence. Peter Drucker, a management guru summarizes the mission statement in the following questions. What is our business? Who is the Customer/ What is of value to the customer? What will our business be?
What should our business be? Successful companies continuously raise these questions and answer them thoughtfully and thoroughly. A well-worked-out mission statement provides employees with a shared sense of purpose, direction, and opportunity. It also guides geographically dispersed employees to work independently and yet collectively toward realizing the organization’s goals.
The environmental analysis includes the internal analysis of the firm, analysis of the firms industry, and external environmental analysis. Internal analysis helps to identify a firm’s strength and weaknesses while the external analysis reveals threats and opportunities. A summary of strengths, weaknesses, opportunities and threats can be generated in a SWOT analysis. An industry analysis will be developed basing Porter’s five forces, which are barriers of entry, supplier bargaining power, buyer bargaining power, threat of substitute products and competitive
The firm generates various strategies basing on the environmental analysis that uses the strengths to exploit opportunities, and minimize the effect of weakness and threats. A firm can formulate strategies such as pricing strategies, distribution and segmentation strategies.
The selected strategies are implemented by means of programs, budgets and procedures. Implementation has a significant impact on the entire strategic planning process, it is therefore imperative to manage change, motivate and empower employees to ensure that the intended results are achieved.
Evaluation and Control
This stage compares the actual results with planned results. This comparison reveals variances, which enables the organization to take corrective measures.