The Strategic Planning Process

1. Input to the Organization: Various Inputs
(People, Capital, Management and Technical
skills, others) including goals input of
claimants (Employees, Consumers, Suppliers,
Stockholders, Government, Community and
others)need to be elaborated.

2. Industry Analysis: Formulation of strategy
requires the evaluation of the attractiveness
of an industry by analyzing the external
environment. The focus should be on the
kind of compaction within an industry, the
possibility of new firms entering the market,
the availability of substitute products or
services, the bargaining positions of the
suppliers, and buyers or customers.

3. Enterprise Profile: Enterprise profile is
usually the starting point for determining
where the company is and where it should
go. Top managers determine the basic
purpose of the enterprise and clarify the firm 's geographic orientation.

5. Mission (Purpose), Major Objectives, and
Strategic Intent : Mission or Purpose is the
answer to the question: What is our
business? The major Objectives are the end
points towards which the activates of the
enterprise are directed. Strategic intent is
the commitment (obsession) to win in the
competitive environment, not only at the
top-level but also throughout the
organization.

6. Present and Future External Environment:
The present and future external
environment must be assessed in terms of
threats and opportunities.

7. Internal Environment: Internal Environment
should be audited and evaluated with
respect to its resources and its weaknesses,
and strengths in research and development,
production, operation, procurement,
marketing and products and services. Other
internal factors include, human resources
and financial resources as well as the
company image, the organization structure
and climate, the planning and control
system, and relations with customers.

8. Development of Alternative Strategies:
Strategic alternatives are developed on the
basis of an analysis of the external and
internal environment. Strategies may be
specialize or concentrate. Alternatively, a
firm may diversify, extending the operation
into new and profitable markets. Other
examples of possible strategies are joint
ventures, and strategic alliances which may
be an appropriate strategy for some firms.

9. Evaluation and Choice of Strategies:
Strategic choices must be considered in the
light of the risk involved in a particular
decision. Some profitable opportunities may
not be pursued because a failure in a risky
venture could result in bankruptcy of the
firm. Another critical element in choosing a
strategy is timing. Even the best product
may fail if it is introduced to the market at
an inappropriate time.

10. Medium/Short Range Planning,
Implementation through Reengineering
the Organization Structure, Leadership
and Control : Implementation of the Strategy
often requires reengineering the
organization, staffing the organization
structure and providing leadership. Controls
must also be installed monitoring
performance against plans.

11. Consistency Testing and Contingency
Planning : The last key aspect of the strategic
planning process is the testing for
consistency and preparing for contingency
plans.

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Fundamentals of Management : Planning [BBA 2305]