1. Planning & Strategic Management
UNIT 4- PLANNING SKILLS OF MANGEMENT Ch. 10 “Planning & Strategic Management” 10.1 (Page1A/1B) SLIDES 1-6, 10.2 (Page 2) SLIDES 7-12
Planning & Strategic Management

2. Formal Planning- Strategic studying of an issue and the preparation of a written document to deal with the problem.
3 RANGES
Short term- 1 year plan
Long-range- 3 to 5 years plus
Intermediate- 1-3 year (the gap between short term and
long range plans)

3. Strategy- an outline of basic management steps to achieve a goal
I. Grand or corporate strategies- Overall (Big Picture) direction for company.
A) Growth Strategies- steps to increase sales or products
Concentration- extend the sale of current products
Vertical Integration- extend into new markets (locations)
Diversification- introduce new or better products

4. Strategies (continued)
B) Stability Strategy- keeping the company operating on the same level- no new development.
C) Defensive Retrenchment Strategy- Developing a plan for a company that is losing sales or profit.
Turnaround- plan to regain success
Diverstiture- to sell a portion of the business (non-profit part of business)
Liquidation- entire company is sold or dissolved
D) Combination Strategy- using several of these strategies at once to maximize profit.

5. II. Business Strategy- Plans that only affect 1 or 2 departments of business
Overall cost leadership- plan to produce and deliver current product at a lower cost.
Differentiation- making product(s) more unique/different.

6. III. Functions Strategies- Short range operation plan
5 most common function plans
1. Sales & Marketing- new products and selling techniques
2. Production- making more products faster
3. Finance- controlling expenses
4. Research & Development- Making new or better products
5. Personnel- Managing employees

7. Section 10.2
Strategic Management- Application of the basic planning process by management.
Strategic Management Approach
(list and define 3 phrases)
Formation- developing the plan
Implementation- activating the plan
Evaluation- analyzing/adjusting the plan
Formulating Strategy- Total vision and business level strategy planning.

8. Mission Statement
Mission Statement- a company’s written statement of purpose- the vision for the company
*objectives of the MS
Common vision and purpose
Motivating resource
Standard of values
Business Culture of company

9. Goals- Companies direction, what do we want to accomplish
Policies- Rules of a company
Procedures- Detailed steps of operating within those rules.
Rules- limits and guidelines

10. SWOT analysis- A tool to evaluate the health of a company

11. Implementing Strategy- How to activate plan
Evaluating Strategy- How to analyze and adjust the plan
Managers should ask
Does the plan need revising
What are the possible problem areas
List the 3 basic strategy evaluation activities
Review all factors (internal and external)
Measure performance (increase sales, decrease costs)
Taking corrective action

12. ONLINE RESEARCH APPLE Research: Mission statement, various products,
SWOT analysis: Strengths
Weaknesses
Opportunities
Threat