STRATEGIC PLANNING PROCESS
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Ford company between 1978 – 1982 had lost her market
shares to the tune of 3billion dollars
Study had revealed that, the causes of these losses is due
adherence to conventional type of quality management
system and orthodox perfection programs
The company sought the advice of Dr.Deming
Who advocated the importance of management, cultural
change, and senior management’s vision
He suggested the following to the management:
 Emphasis on quality and review of new product planning and design
 Continues investment in new products and processes
 Making employee relations a source of competitive advantage
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Strategy _ A general plan or set of plans intended to
achieve something, especially over a long period
Tactic _ A method that you chose to use to achieve what
you want in a particular situation
It is an established fact that the key to competitive
success is improvement of quality. Which is not enough
for Japanese strategist, as they are now moving ahead
from:• TQM to Zero Defect Management
• Leadership in technology, marketing and management ( brain
capital )
◦ Access to the knowledge, and investing on foreign students
◦ Exercising proprietary rights over knowledge - acquired
through foreigner employees
◦ Own research institutes within the organization to
disseminate knowledge to the concerned group or
management
◦ Reorganizing R&D with the objective, ‘’ The faster we can
abandon today’s new product, the stronger and more
profitable we’ll be ‘’ is the new motto
◦ Thereby meaning that, immediately going to work on
replacing it on three tracks i.e.
 Kaizen,
 Leaping _ developing a new one out of the old
 finally moving to Zero defect
STRATEGIC PLANNING PROCESS
Most of the companies attribute their success to a Quality
based strategy through:
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A formally structured approach that helps planning a
strategic decision by Top Management, concentrating on
every facet of the business
 How to compete
 What are the goals, and
 What all policies are needed
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How ever the primary strategy remains to achieve and
maintain competitive advantage through
A systematic look at organization, how each part interrelates
to the whole process and
Demanding continuous improvement as ‘a way of life’
STRATEGIC PLANNING PROCESS(cont.)
A Harvard Business School based policy group describes the
pattern of a corporate strategy as:
a. It determines, shapes, and reveals its objectives, purposes,
or goals
b. Produces the principles polices and plans for achieving
these goals
c. Defines the business the company intends to be in
d. The kind of economic and human organisation it intends to
be
e. The nature of the economic and non-economic
contribution it intend to make to its shareholders,
employees, customers, and communities
Strategic Quality Management
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The pattern of goals, policies, plans, and human organisation
are likely to be in place over a long period of time, therefore
effects the organisation in following different ways:
i.
The culture that guides members of the organisation and other stake
holders
ii. The position that it will occupy in an industry and market segment
iii. Determining particular objectives and allocating resources to achieve
them
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All follow from the decision processes determined by strategy
The pervasiveness of a given strategy can be measured
through the developed plans and the communication
achieved
A basic rule of strategic planning is that structure follows
strategy
Strategic Quality Management
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The strategic positioning process in an environment involves
placing yourself against forces in a way that action plan can
minimise your weakness and take advantage of your strengths
The relative strength with competitors is Quality, which is the
means of differentiation for the satisfaction of customers needs
Additionally, firms with superior quality addresses quality
offensively , while firms with inferior quality treat it defensively
Following are the components of strategy:a. Product/ market space
b. Competitive edge(differentiation)
c. Supporting policy
d. Objectives
e. Organizational culture
MISSION
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‘meet the needs / values of constituents’
A mission is promulgation of objectives by statements as to
how it will be implemented for each stakeholder e.g.
‘’ Our mission is constant improvement in products and
services to meet our requirement’’
Basically, it translates the commitment of entire organization
in the direction the company intends to move
The major determinant of a mission is the environment in
which the firm plans to operate
As trends and changes unfold in that environment, strategy
ensures positioning and adjusting oneself accordingly
Thus it is important to identify trends in an environment and
how it influences the strategy of the firm
PRODUCT / MARKET SCOPE
Q. What am I selling and to whom am I selling it?
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A company does not sell shoes or soap or banking services
It sells value to a particular segment of the market
What is value?
It is what customer says, therefore, each company must
define its market segment and customer value in that
segment
Because a particular quality of item can not be sold alike in
different segments of market, rather quality is defined
differently for a different segment of the market
DIFFERENTIATION
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Why should I buy from you?
Uniqueness of Product and quality Service are termed as
differentiation
These are the two major forces that gives competitive edge in
market place and in international trade
Term uniqueness does not mean the physical product or in its
marketing practices
Rather those attributes in ‘quality and value’ that meet the
needs of the largest number of consumers at an acceptable
price
OBJECTIVES
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A strategy often fails to implement, when it lacks to have an
action plan based on objectives
which is a prerequisite for following a plan.
In this regard, the concept of Management By Objective
( MBO ) identifies eight key areas for which objectives
(functions of business) must be set
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Marketing (market share)
6. Financial resources
Innovation (new product)
(capital structure )
Human organisation
7. Social responsibility
Physical resources
8. Profit requirement
Productivity(output per employee)
SUPPORTING POLICIES
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A strategy is nothing without an objective
Similarly, for the attainment of objectives, policies or action
plans are made as guidelines for action and decision making
The delineation of mission, differentiation and objectives
forms the nucleus of a business
While the activities like marketing, HRM, productivity etc. are
the functions of the business
Each function needs supporting policies to achieve the targets
defined in nucleus
The supporting policies determine what activities to perform
and how to perform them?
CONCLUSION
Adherence to quality has become an important
subject for corporate/national interest. Those not
implementing it will not be able to compete
effectively in the market. Embedding TQM in
strategic planning from objectives to supporting
polices eventually leads to success, that basically
means customer’s value for the product and services,
and carefully implementing a quality based culture