Corporate Strategic Planning

Corporate Strategic Corporate Strategic PlanningPlanning

Asia-Pacific Marketing Asia-Pacific Marketing FederationFederation

Certified Professional MarketerCertified Professional MarketerCopyrightCopyright

Marketing Institute of SingaporeMarketing Institute of Singapore

OutlineOutline

IntroductionIntroduction Meaning & Role of Strategic Meaning & Role of Strategic

PlanningPlanning Corporate MissionCorporate Mission Strategic Business Units (SBU)Strategic Business Units (SBU) Marketing AuditMarketing Audit

Strategic PlanningStrategic Planning

……is the managerial process of is the managerial process of developing and maintaining a developing and maintaining a strategic fit between the strategic fit between the organization's objectives and organization's objectives and resources and its changing market resources and its changing market opportunities.opportunities.

Org Objectives Resources

Changing Environment

Strategic Fit

The Role of StrategyThe Role of Strategy

CorporateMission &Objectives

Strategy:•Corporate•Business•Functional

Operating Plans

Sun TzeSun Tze on Strategy on Strategy

““Know your enemy, know yourself, Know your enemy, know yourself, and your victory will not be and your victory will not be threatened. Know the terrain, know threatened. Know the terrain, know the weather, and your victory will the weather, and your victory will be complete.”be complete.”

Strategic MarketingStrategic Marketing

““Marketing Strategy is a series Marketing Strategy is a series of integrated actions leading to of integrated actions leading to a sustainable competitive a sustainable competitive advantage.”advantage.”

John ScullyJohn Scully

Corporate MissionCorporate Mission

Broad purposes of the organizationBroad purposes of the organizationGeneral criteria for assessing the long-General criteria for assessing the long-

term organizational effectivenessterm organizational effectivenessDriven by heritage & environmentDriven by heritage & environmentMission statements are increasingly Mission statements are increasingly

being developed at the SBU level as being developed at the SBU level as wellwell

Examples of Corporate MissionExamples of Corporate Mission

SINGAPORE AIRLINES is engaged in air SINGAPORE AIRLINES is engaged in air transportation and related businesses. transportation and related businesses. It operates world-wide as the flag It operates world-wide as the flag carrier of the Republic of Singapore, carrier of the Republic of Singapore, aiming to provide services of the aiming to provide services of the highest quality at reasonable prices for highest quality at reasonable prices for customers and a profit for the companycustomers and a profit for the company

Examples of Corporate Mission Examples of Corporate Mission (cont’d)(cont’d)

MARRIOTT’S Mission Statement:MARRIOTT’S Mission Statement:

We are committed to being the best We are committed to being the best lodging and food service company in lodging and food service company in the world, by treating employees in the world, by treating employees in ways that create extraordinary ways that create extraordinary customer service and shareholder customer service and shareholder valuevalue

Corporate CultureCorporate Culture

The most abstract level of The most abstract level of managerial thinkingmanagerial thinking

How do you define culture?How do you define culture?What is the significance of culture What is the significance of culture

to an organization?to an organization?How does marketing affect How does marketing affect

culture in the organization?culture in the organization?

Corporate Objectives & GoalsCorporate Objectives & Goals

An objective is a long-range purpose An objective is a long-range purpose Not quantified and not limited to a time periodNot quantified and not limited to a time period E.g. increasing the return on shareholders’ E.g. increasing the return on shareholders’

equityequity

A goal is a measurable objective of A goal is a measurable objective of the businessthe business Attainable at some specific future date through Attainable at some specific future date through

planned actionsplanned actions E.g. 10% growth in the next two yearsE.g. 10% growth in the next two years

What is a Strategic What is a Strategic Business Unit? (SBU)Business Unit? (SBU)

A set of products or product lines A set of products or product lines With clear independence from other With clear independence from other

products or product lines products or product lines for which a business or marketing for which a business or marketing

strategy should be designedstrategy should be designed

Characteristics of a viable SBUCharacteristics of a viable SBU

Unique business missionUnique business missionDefinable set of competitorsDefinable set of competitors Integrative planning done Integrative planning done

independentlyindependentlyResponsible for resource management Responsible for resource management

in all areasin all areas Large enough but not so large as to Large enough but not so large as to

become bureaucraticbecome bureaucratic(Source: Subhash Jain, Marketing Planning & Strategy, 6th Ed.)

Organizational Marketing LevelsOrganizational Marketing Levels

Hofer and Schendel suggested that Hofer and Schendel suggested that organizations develop strategies at organizations develop strategies at three structural levels:three structural levels:

Corporate level—(corporate Corporate level—(corporate marketing)marketing)

SBU level—(Strategic Marketing)SBU level—(Strategic Marketing) Product/Market level—(Functional Product/Market level—(Functional

Marketing)Marketing)

Marketing at the SBU Level—Marketing at the SBU Level—Strategic MarketingStrategic Marketing

Strategic Marketing requiresStrategic Marketing requires Detailed understanding of market Detailed understanding of market

needs, and needs, and Proactive use of competitive Proactive use of competitive

intelligence at the corporate as well intelligence at the corporate as well as SBU’s levelsas SBU’s levels

Strategic Marketing Strategic Marketing Focuses on what the firm do best at Focuses on what the firm do best at

the SBU levelthe SBU level To secure and maintain a sustainable To secure and maintain a sustainable

competitive advantagecompetitive advantage

What is Competitive Advantage?What is Competitive Advantage?

““Competitive advantage is a Competitive advantage is a company’s ability to perform in one company’s ability to perform in one or more ways that competitors or more ways that competitors cannot or will not match.”cannot or will not match.”

Philip KotlerPhilip Kotler

““If you don’t have a competitive If you don’t have a competitive advantage, don’t compete.”advantage, don’t compete.”

Jack Welch, Jack Welch, GEGE

Other Characteristics of Competitive Other Characteristics of Competitive AdvantageAdvantage

SubstantialitySubstantiality Is it substantial enough to make a difference?Is it substantial enough to make a difference?

SustainabilitySustainability Can it be neutralized by competitors quickly?Can it be neutralized by competitors quickly?

Ability to be leveraged into visible Ability to be leveraged into visible business attributes that will influence business attributes that will influence customerscustomers

(Source: Strategic Marketing Management, Aakers)

Seeking Competitive AdvantagesSeeking Competitive Advantages

Positions of advantagePositions of advantage Superior customer valueSuperior customer value Lower relative total costLower relative total cost

Performance advantagesPerformance advantages Customer satisfaction, Loyalty, Market

Share, Profit

Sources of advantagesSources of advantages Superior skills & knowledge, Superior

resources, Superior business process

Key Elements of Marketing Strategy Key Elements of Marketing Strategy FormulationFormulation

The strategic 3 Cs The strategic 3 Cs Customers, Competitors & the Customers, Competitors & the

CorporationCorporation

Environment analysis -- PESTEnvironment analysis -- PEST   Strategic Marketing DecisionsStrategic Marketing Decisions

Where to competeWhere to compete How to competeHow to compete When to competeWhen to compete

Must have a clearly defined market Must have a clearly defined market Must have a good match between Must have a good match between

corporate strengths and market corporate strengths and market needsneeds

Must have significant positive Must have significant positive differentiation in the key success differentiation in the key success factors of the businessfactors of the business

A Viable Marketing StrategyA Viable Marketing Strategy

Situation AnalysisSituation Analysis

Internal Analysis—Internal Analysis—company; capability etc.company; capability etc.

External Analysis—External Analysis—customers, market customers, market definition, industry structuredefinition, industry structure

SWOT AnalysisSWOT AnalysisSStrengths, trengths, WWeaknesses, eaknesses,

OOpportunities & pportunities & TThreatshreats Identify & prioritize major problems and Identify & prioritize major problems and

opportunities: selection of key issuesopportunities: selection of key issues

Based on the firm’s core Based on the firm’s core competencies, decide on future competencies, decide on future optionsoptions

Marketing AuditMarketing Audit

““Marketing audit is a comprehensive, Marketing audit is a comprehensive, systematic, independent, and periodic systematic, independent, and periodic examination of a company’s—or business examination of a company’s—or business unit’s—marketing environment, unit’s—marketing environment, objectives, strategies, and activities with a objectives, strategies, and activities with a view to determining problem areas and view to determining problem areas and opportunities and recommending a plan of opportunities and recommending a plan of action to improve the company’s action to improve the company’s marketing performance”marketing performance” Philip Philip KotlerKotler

Characteristics of Marketing AuditCharacteristics of Marketing Audit

ComprehensiveComprehensive Must cover all marketing areasMust cover all marketing areas

SystematicSystematic Sequential diagnostic stepsSequential diagnostic steps

IndependentIndependent Internal & external auditorsInternal & external auditors

PeriodicPeriodic Performed at regular intervalsPerformed at regular intervals

Marketing Audit ProcedureMarketing Audit Procedure

Marketing environment auditMarketing environment audit Marketing strategy auditMarketing strategy audit Marketing organization auditMarketing organization audit Marketing system auditMarketing system audit Marketing productivity auditMarketing productivity audit Marketing function auditMarketing function audit Marketing excellence reviewMarketing excellence review Ethical and social responsibility reviewEthical and social responsibility review