1. STRATEGIC PLANNING PROCESS
DEVELOPING A
STRATEGIC VISION AND
BUSINESS MISSION

2. Bijay KC, Ph.D SAIM College
STRATEGIC PLANNING
WHAT IS IT?
WHY DO YOU NEED IT?
WHAT IS ITS PROCESS?
Bijay KC, Ph.D SAIM College

3. STRUCTURE AND PROCESS OF PLANNING
Expectations Of
Outsiders
Society
Government
Strategic Planning
Tactical Planning
Expectations Of
Insiders
Top Mgmt
Staff
The
Plan To
Master
Strategy
Mission
Objectives
Policies
Medium
Range
Program
-ming
And
Plans
Short
Range
Planning
And
Plans
Implemen
-tation
Of Plans
Reviews
And
Evaluation Of
Plans
The Data base
1. Past
Performance
2. Current
Situation
3. Forecasts
Evaluation Of
Environment
Opportunity
Threat
Organization
Strength
Weakness
Decision and Evaluation Rules

4. DEVELOPING A STRATEGIC VISION
What will the firm be in the future?
It shows future direction
Mission
What is the firm’s business today?
It deals more with what the firm is doing today than what it wants to be in the future
Bijay KC, Ph.D SAIM College

5. Vision statement answers the question:
“What do we want to become?”
Bijay KC, Ph.D SAIM College

6. Mission statement answers the question:
“What is our business?”
Bijay KC, Ph.D SAIM College

7. Bijay KC, Ph.D SAIM College
WHY STRATEGIC VISION
To determine future direction of a firm
To give special identity and business emphasis
To provide meaningful guidance to the firm’s future
Strategic visions are firm specific, not generic
Strategic vision should not be too general
Bijay KC, Ph.D SAIM College

8. ELEMENTS OF STRATEGIC VISION/MISSION
Defining a firm’s present business
Broad or narrow definition
It should not be too broad that includes everything and gives no future direction to the firm’s business.
It should not be too specific and narrow so that it limits the firm’s scope for business expansion
Bijay KC, Ph.D SAIM College

9. Definition of firm’s present business should include:
Customers need: what is being satisfied, not just product or service
Customers’ group: who are being satisfied
Geographic domain; national or international, Age, Income etc
3. Technology used: How are the customers needs being satisfied
Bijay KC, Ph.D SAIM College

10. COMPONENTS OF A MISSION STATEMENT: Customers
Who are the firm’s customers?
"We believe our first responsibility is to the doctors, nurses, and patients, to mothers and all others who use our products and services."
(Johnson & Johnson)
Bijay KC, Ph.D SAIM College

11. Bijay KC, Ph.D SAIM College
Products or services:
What are the firm's major products or services?
Standard Oil Company ( Indiana) is in business to find and produce crude oil, natural gas and natural gas liquids; to manufacture high-quality products useful to society from these raw materials; and to distribute and market those products and to provide dependable related services to the consuming public at reasonable prices.
(Standard Oil Company)
Bijay KC, Ph.D SAIM College

12. Bijay KC, Ph.D SAIM College
Markets
Geographically, where does the firm compete?
"We are dedicated to the total success of Corning Glass Works as a worldwide competitor."
(Corning Glass Works)
Bijay KC, Ph.D SAIM College

13. Bijay KC, Ph.D SAIM College
Technology
Is the firm technologically current?
"Control Data is in business of applying micro-electronics and computer technology in two general areas: computer-related hardware; and computing-enhancing services, which include computation, information, education, and finance."
(Control Data)
Bijay KC, Ph.D SAIM College

14. Concern for survival, growth, and profitability
Is the firm committed to growth and financial soundness?
"To serve the worldwide need for knowledge at a fair profit by adhering, evaluating, producing, and distributing valuable information in a way that benefits our customers, employees, other investors, and our society."
(McGraw-Hill)
Bijay KC, Ph.D SAIM College

15. Bijay KC, Ph.D SAIM College
Philosophy
What are the basic beliefs, values, aspirations, and ethical priorities of the firm?
"It's all part of the Mary Kay philosophy – a philosophy based on the golden rule. A spirit of sharing and caring where people give cheerfully of their time, knowledge, and experience."
(Mary Kay Cosmetics)
Bijay KC, Ph.D SAIM College

16. Bijay KC, Ph.D SAIM College
Self-concept
What is the firms' distinctive competence or major competitive advantage?
"Crown Zellerbach is committed to leapfrogging ongoing competition within 1,000 days by unleashing the constructive and creative abilities and energies of each of its employees."
(Crown Zellerbach)
Bijay KC, Ph.D SAIM College

17. Concern for public image
Is the firm responsive to social, community, and environmental concerns?
"To contribute to the economic strength of society and function as a good corporate citizen of a local, state, and national basis in all countries in which we do business."
(Pfizer)
Bijay KC, Ph.D SAIM College

18. Bijay KC, Ph.D SAIM College
Concern for Employees
Are employees a valuable assets of the firm?
"To compensate its employees with remuneration and fringe benefits competitive with other employment opportunities in its geographical area and commensurate with their contributions toward efficient corporate operations."
(Public Service Electric and Gas Company)
Bijay KC, Ph.D SAIM College

19. An Evaluation Matrix of Mission Statements
Organization
Customers
Products/Services
Markets
Concern for survival, growth, and profitability
Technology
Philosophy
Self-concept
Concern for Public Image
Concern for Employees
Bijay KC, Ph.D SAIM College

20. An Evaluation Matrix of Mission Statements
Organization
Customers
Products/Services
Markets
Concern for survival, growth, and profitability
Technology
Philosophy
Self-concept
Concern for Public Image
Concern for Employees
Pepsi-Co
Yes No
PSI
Genetech
IEDI
BATA
Coca-cola India
Bijay KC, Ph.D SAIM College

21. An Evaluation Matrix of Mission Statements
Organization
Customers
Products/Services
Markets
Concern for survival, growth, and profitability
Technology
Philosophy
Self-concept
Concern for Public Image
Concern for Employees
Pepsi-Co
Yes No
PSI
Genetech
BATA
Coca-cola India
Bijay KC, Ph.D SAIM College

22. B. Deciding on the long-term strategic vision of the firm
How long should the mission cover?
Environmental Analysis and forecast is needed for this
Identify and forecast the trends in the driving forces and possible changes in these forces
Bijay KC, Ph.D SAIM College

23. C. Communicating the Strategic Vision
Strategic vision should be communicated downward
It should be simple and clear
It should serve as a powerful tool for motivating people
It should tell the staff where the firm is heading for and how they can contribute to it
Bijay KC, Ph.D SAIM College

24. Bijay KC, Ph.D SAIM College
LONG-TERM OBJECTIVES
STRATEGIC VISION AND MISSION NEEDS TO BE BROKEN DOWN INTO SPECIFIC OBJECTIVES.
Kinds of objectives:
Objectives for financial performance
Growth in Revenue, ROI etc
Objectives for strategic performance:
Market share, Quality, product line
Bijay KC, Ph.D SAIM College

25. CRETIRIA FOR SETTING OBJECTIVES
Suitable
Measurable overtime
Feasible
Acceptable
Flexible
Motivating
Understandable
Commitment
Participation
Linkages
Bijay KC, Ph.D SAIM College

26. Methods for setting objectives
Based on past performance
Trends adjusted for future
Negotiations
Top Management
Iteration with the strategy
Result of SWOT analysis
Bijay KC, Ph.D SAIM College