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Chapter IV

Strategic Planning and Organizational Objectives

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When you finish this chapter, you should be able to:Nature of strategic planningLevels of strategyImportance of strategy planSteps in the strategic planning processDefining the mission of the organizationDeveloping the organizational objectivesAssessing organizational resources, risks, and

opportunitiesFormulating strategyImplementing strategy

Learning Objectives

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I. Nature of strategic planning

Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people.

1.1 Levels of strategy

Strategy can be formulated on three different levels:

-corporate level

-business unit level

-functional or departmental level.

1.2 The importance of strategy plan:

-We all need to know where we are going

-Plan is the compass

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II. Steps in the strategic planning process

Steps in the strategic planning process:

Mission

Objective

Assessing: Resource, Risks, and Opportunities

Formulating Strategy

Implementing Strategy

Monitoring & Adapting Strategic Plans

Feed

back

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The mission statement should be a clear and succinct representation of the enterprise's purpose for existence.

2.1 Defining the mission of organization

What do we do business?Who is our customers?What should we provide goods/services?

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Objectives give the business a clearly defined target.

2.2 Developing the organizational objectives:

Create the road or approach

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2.3 Assessing organizational resources, risks, and opportunities

Manager must analyze SWOT

And compare to other organizations

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Strengths-Profits-Financial Resources-Honest Customers-Modern Physic Equipments-Patent

Opportunities-Increasing of demands-Entrance new markets-Buy technologic company-Increasing of products

Treats-Changes of customers’ demands -Government’s policies

Weaknesses-Small line-products-Lack of management-Poor finance-Poor market-High cost of labor

Problems

Ability

Be able risksForce

SWOT Analysis

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2.4 Formulating Strategy:

Environmental Strategies: (Focusing on resources related to environment)Strategic Model: Mr. Miles and Mr. Snow discovered 4 strategies: a. Prospector: new opportunity, & high risk >new

products>new marketsb. Defender: marketing stability, no changingc. Analyzer: aggregating prospector & defenderd. Reactor: always no show clear plan, have trends to exchange of opportunity.

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Strategic Window:Duration of limited timeMain tasks of markets appropriated to ability of companyMonitoring external environment

2.4 Formulating Strategy:

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Strategic Business Unit (SBU): is understood as a business unit within the overall corporate identity which is distinguishable from other business because it serves a defined external market where management can conduct strategic planning in relation to products and markets.

2.4 Formulating Strategy:

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The selected strategy is implemented by means of programs, budgets, and procedures. Implementation involves organization of the firm's resources and motivation of the staff to achieve objectives.

2.5 Implementing Strategy:

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National HIV/AIDS Strategy Implementation

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Evaluation and control consists of the following steps:Define parameters to be measured

Define target values for those parameters

Perform measurementsCompare measured results to the pre-defined standard

Make necessary changes

2.6 Monitoring and Adapting Strategic Plans:

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