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    Week 4

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    Week 4

    Uploaded by

    Rainy
    9 views32 pages

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    9 views32 pages

    Week 4

    Uploaded by

    Rainy

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    © All Rights Reserved
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    of 32

    Strategic

    Planning
    Agenda
    01. Introduction 02. Process

    03. Benefits 04. Models 05. Conclusion

    2
    Introduction
    Strategic planning is the art of creating specific
    business strategies, implementing them, and
    evaluating the results of executing the plan, in
    regard to a company’s overall long-term goals
    or desires. It is a concept that focuses on
    integrating various departments (such as
    accounting and finance, marketing, and human
    resources) within a company to accomplish its
    strategic goals. The term strategic planning is
    essentially synonymous with strategic
    management

    3
    Strategic Planning
    Process
    1. Strategy Formulation
    • In the process of formulating a strategy, a company will first
    assess its current situation by performing an internal and external
    audit.
    • As a result of the analysis, managers decide on which plans or
    markets they should focus on or abandon, how to best allocate
    the company’s resources, and whether to take actions such as
    expanding operations
    • Business strategies have long-term effects on organizational
    success. Only upper management executives are usually
    authorized to assign the resources necessary for their
    implementation.
    2. Strategy Implementation
    • After a strategy is formulated, the company needs to establish
    specific targets or goals related to putting the strategy into action,
    and allocate resources for the strategy’s execution. The success
    of the implementation stage is often determined by how good a
    job upper management does in regard to clearly communicating
    the chosen strategy throughout the company and getting all of its
    employees to “buy into” the desire to put the strategy into action.
    • Effective strategy implementation involves developing a solid
    structure, or framework, for implementing the strategy,
    maximizing the utilization of relevant resources, and redirecting
    marketing efforts in line with the strategy’s goals and objectives.
    3. Strategy Evaluation
    • Any savvy business person knows that success today does not
    guarantee success tomorrow. As such, it is important for
    managers to evaluate the performance of a chosen strategy after
    the implementation phase.
    • Strategy evaluation involves three crucial activities: reviewing the
    internal and external factors affecting the implementation of the
    strategy, measuring performance, and taking corrective steps to
    make the strategy more effective.
    Benefits
    • The volatility of the business environment causes many firms to
    adopt reactive strategies rather than proactive ones. However,
    reactive strategies are typically only viable for the short-term, even
    though they may require spending a significant amount of
    resources and time to execute. Strategic planning helps firms
    prepare proactively and address issues with a more long-term
    view. They enable a company to initiate influence instead of just
    responding to situations.
    1. Helps formulate better strategies
    using a logical, systematic approach
    • This is often the most important benefit. Some studies show that
    the strategic planning process itself makes a significant
    contribution to improving a company’s overall performance,
    regardless of the success of a specific strategy.
    2. Enhanced communication between
    employers and employees
    • Communication is crucial to the success of the strategic planning
    process. It is initiated through participation and dialogue among
    the managers and employees, which shows their commitment to
    achieving organizational goals.
    3. Empowers individuals working in the
    organization
    • The increased dialogue and communication across all stages of
    the process strengthens employees’ sense of effectiveness and
    importance in the company’s overall success. For this reason, it is
    important for companies to decentralize the strategic planning
    process by involving lower-level managers and employees
    throughout the organization.
    Strategic Planning Models

    SWOT Analysis PEST Analysis

    Porter’s 5 Forces Analysis Balanced Scorecard

    VRIO Blue Ocean Strategy

    McKinsey 7S Framework Strategy Map

    Hoshin Kanri Alignment Model


    SWOT Analysis

    SWOT analysis is a strategic planning and strategic


    management technique used to help a person or
    organization identify Strengths, Weaknesses,
    Opportunities, and Threats related to business
    competition or project planning. It is sometimes called
    situational assessment or situational analysis.
    Porter’s 5 Forces

    Porter's Five Forces Framework is a method of


    analyzing the operating environment of a competition of
    a business. It draws from industrial organization
    economics to derive five forces that determine the
    competitive intensity and, therefore, the attractiveness
    of an industry in terms of its profitability.
    Balanced Scorecard

    A balanced scorecard is a strategy performance


    management tool – a well-structured report used to
    keep track of the execution of activities by staff and to
    monitor the consequences arising from these actions.
    PEST Analysis

    In business analysis, PEST analysis describes a


    framework of macro-environmental factors used in the
    environmental scanning component of strategic
    management.
    VRIO

    VRIO is a business analysis framework that forms part


    of a firm's larger strategic scheme, proposed by Jay
    Barney in 1991. The basic strategic process of any firm
    begins with a vision statement, and continues on
    through objectives, internal & external analysis,
    strategic choices, and strategic implementation.
    Blue Ocean Strategy

    BLUE OCEAN STRATEGY is the simultaneous pursuit


    of differentiation and low cost to open up a new market
    space and create new demand. It is about creating and
    capturing uncontested market space, thereby making
    the competition irrelevant. It is based on the view that
    market boundaries and industry structure are not a
    given and can be reconstructed by the actions and
    beliefs of industry players.
    McKinsey 7S Framework

    The McKinsey 7S Framework is a management model


    developed by business consultants Robert H.
    Waterman, Jr. and Tom Peters in the 1980s. This was a
    strategic vision for groups, to include businesses,
    business units, and teams. The 7 S's are structure,
    strategy, systems, skills, style, staff and shared values.
    Strategy Map

    A strategy map is a diagram that documents the


    strategic goals being pursued by an organization or
    management team.
    Hoshin Kanri

    This framework is used to align goals with tasks,


    keeping everything coordinated and ensuring that
    everybody is working toward the same end result.
    Summary

    An increasing number of companies use strategic planning to formulate


    and implement effective decisions. While planning requires a significant
    amount of time, effort, and money, a well-thought-out strategic plan
    efficiently fosters company growth, goal achievement, and employee
    satisfaction.
    Thank you

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