Planning and
Strategic
Management
Chapter Four
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Learning Objectives
LO1 Summarize the basic steps in any planning
process.
LO2 Describe how strategic planning should be
integrated with tactical and operational
planning.
LO3 Identify elements of the external environment
and internal resources of the firm to analyze
before formulating a strategy.
LO4 Define core capabilities and explain why they
provide the foundation for business strategy.
4-2
Learning Objectives (cont.)
LO5 Summarize the types and choices available for
corporate strategy.
LO6 Discuss how companies can achieve competitive
advantage through business strategy.
LO7 Describe the keys to effective strategy
implementation.
4-3
Decision Making Stages and
Formal Planning Steps
Figure 4.1
4-4
Planning
Planning


conscious, systematic process of making
decisions about goals and activities that an
individual, group, work unit, or organization will
pursue in the future.
a purposeful effort that is directed and controlled
by managers and often draws on the knowledge
and experience of employees throughout the
organization.
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Situational Analysis
Situational analysis

A process planners use, within time and resource
constraints, to gather, interpret, and summarize
all information relevant to the planning issue
under consideration.
4-6
Alternative Goals and Plans
 Plans
 The actions or means
managers intend to
use to achieve
organizational goals
 Contingency plans
 sets of actions to be
taken when a
company’s initial
plans have not
worked well or if
events in the
external
environment require
a sudden change
4-7
Goal and Plan Evaluation
Managers will evaluate the advantages,
disadvantages, and potential effects of each
alternative goal and plan.
Must prioritize those goals and even eliminate
some of them.
Managers must consider carefully the
implications of alternative plans for meeting high
priority goals.
4-8
Strategic Planning
 Strategic planning
 A set of procedures
for making decisions
about the
organization’s longterm goals and
strategies
 Strategic goals
 major targets or end
results that relate to
the long-term
survival, value, and
growth of the
organization.
4-9
Strategic Planning
 Strategy
 A pattern of actions
and resource
allocations designed
to achieve the
organization’s goals
4-10
Hierarchy of Goals and Plans
Figure 4.2
4-11
Strategic Planning
Strategic management

A process that involves managers from all parts
of the organization in the formulation and
implementation of strategic goals and strategies.
4-12
Establishment of Mission, Vision,
and Goals
 Mission
 An organization’s
basic purpose and
scope of operations.
4-13
SWOT Analysis and Strategy
Formulation
SWOT analysis

A comparison of strengths, weaknesses,
opportunities, and threats that helps executives
formulate strategy.
4-14
Summary of Corporate Strategies
Figure 4.7
4-15