the basic components of the strategic planning process are the same at each of the different levels
Level 1: Corporate Level -
the vision, mission, values and corporate goals.
Not all firms choose to create all elements.
Level 2: Business Level
SBU1: PepsiCo Beverages North America
Each SBU develops its own combination of vision, mission, values and goals
situation analysis is critical to the development of business level goals, objectives, and strategy.
A SWOT or Blue Ocean strategy helps to determine new market opportunities.
Level 3: Functional Levels
Planning at department levels (Accounting, Finance, HR, Operations, Management, Marketing, R&D) within each SBU.
The situation analysis, SWOT, or Blue Ocean Strategy performed by the business unit provides essential input to the functional planning process.
Marketing plans are created for product lines and individual brands.
demographic, geographic, and psychographic profiles of current and potential customers,
Psychographics include lifestyle, opinions, and activities and interests.
Marketers must also understand whether the person who buys the product is the same person who uses the product.
in some situations, the purchase is influenced by a third party, via reviews, personal advice or by some other means.
In some cases, multiple potential markets exist, and a major focus of the planning process is to analyze the market potential of different potential segments
Artifical Intelligence (AI):
"narrow AI," meaning that the AI is built to perform a specific task, such as driving a truck or translating a language.
"Applied AI" includes robots, consumer electronics, apps, services, virtual personal assistants, and other implementations that embed AI into devices and existing software and services.
Intelligent Apps and Analytics:
Intelligent things interact naturally with their surroundings and people. Delivery drones and other physical items that can operate unsupervised for a time while completing a task are considered intelligent things.
Virtual personal assistants (VPA) and virtual customer assistants (VCA) will strongly influence how people interact with the digital world. Examples of existing VPAs include Google Now, Microsoft's Cortana, and Apple's Siri, as well as the more advanced Alexa.
Immersive Experience Using Virtual Reality, Augmented Reality and Mixed Reality:
Blockchain is an up and coming distributed-ledger technology that promises to be the future infrastructure for the digital currency.
Blockchain eliminates the need for one trusted central authority to keep track of transactions.
Everyone in the transaction circuit shares data, and once entered, protocols are in place that prevent deletion or alteration, which drastically cuts down on the potential for hiding fraud or embezzlement.
Blockchain also allows for "smart contracts" to be implemented. For example, if someone who has leased a car fails to make payment after two or three months, a smart contract could interface with the car and prevent the user from starting the vehicle until (s)he caught up on lease payments.
are the competitive rivals that people most commonly associate with the concept of direct competition, as they market offerings with similar features and benefits to the same customers as the firm's brand, at about the same price.
operate within the same product class and satisfy the same general need, but the products differ concerning price, features, and benefits. So orange juice is a refreshing beverage which also contains vitamin C. Bottled water has no sugar substitutes, while energy drinks offer caffeine or other stimulants in higher quantities than are available in soft drinks. Each of these beverages is a product competitor to Diet Coke, even if offered by the same parent firm (e.g., Coca-Cola). Product competitors are most closely associated with substitute products, as defined by Michael Porter.
satisfy the same very general benefit (refreshment) with different products. Kool-Aid powder and lemonade mixes, the Sodastream, frozen drink mixes, alcoholic beverages and mixes, and concentrated liquid flavor dispensers that can be added to tap water might be some examples.
Total budget competitors are simply any item or activity on which consumers may spend their money at the expense of the firm's offering. It could be Netflix, cough medicine, or a new car.
involves ethically and legally identifying current and future competitors and developing an understanding of their strengths, weaknesses, and plans
analyzing the competition's supply chain and technological, financial, marketing, and manufacturing capabilities and vulnerabilities
most difficult task is trying to predict the strategies that competitors will implement, and how they will react to strategies implemented by the firm while marketing its offering
It's worth noting that while most strategic planning activities, such as the SWOT, place a high priority on competitive information and how it can be used, especially against brand competitors, not all strategic planning processes follow the same philosophy. The Blue Ocean Strategy, for example, seeks to make the competition irrelevant
relies heavily on secondary data
Secondary information is data that was originally gathered for a purpose other than the research project at hand, or in this case, the actual situation analysis. Secondary data can be internal, meaning that it stems from the firm's databases, records, past strategies and plans, or it can be external, meaning that the data were collected outside of the firm.
Internal secondary data forms the heart of the internal analysis and includes all marketing objectives, strategies, and performance, organizational resources and organizational culture, and structural issues.
Internal data is also an excellent place to find customer information for an existing brand or product line.
When a commercial research study report already exists before the situation analysis, it is considered secondary data.
Government - Hoovers etc. - Trade Associations - Academic Journals - general business publications like Forbes etc.
The major benefit of data found in trade association publications is that they are relevant and very timely
the most common problem with external secondary research is that planners cannot find all of the information needed, and thus form an inaccurate picture of the situation. Often this occurs because the information sought does not exist as external secondary data.
- Also cost and info overload
invest heavily in both technology and R&D
continuously introduce superior, high-quality products
new features or higher levels of existing features
Development of complementary products
can often lead to premium prices and greater profitability for the firm.
abundant financial resources to fund research and development and technological investments,
human capital strengths, such as exceptional or visionary leadership, access to a highly skilled labor force, teams that work well together, competent management, and strong marketing skills.
A narrow, homogeneous market segment is targeted
Marketing plans focus on introducing high quality, technologically advanced products in an attempt to create consumer loyalty
PESTEL analysis is ongoing;
new opportunities are sought continually as firms make their own offerings obsolete through innovation
The organization is often decentralized, and the culture is adaptable, entrepreneurial, creative, and willing to learn from failure
The firm has a positive attitude stressing, "How CAN we make this work?" as opposed to "Why CAN'T we make it work?"
core competencies (internal strengths)
Basic research, and rapid interpretation of research results
Applied product development research
Fast capitalization and development of market opportunities
Excellent marketing skills
operate more efficiently and at a lower cost than their competition
value they deliver is price-based, stemming from lower production costs, economies of scale, lower raw material costs, lower delivery/distribution/supply chains costs, etc.
A lower cost structure means that the firm can beat competitor's prices, providing the same benefits at a lower price.
A broad, price sensitive, heterogeneous group of buyers is targeted
Value is delivered to buyers using low price, standardized offerings, and convenient buying processes
Financial resources are investments to achieve economies of scale and efficiency driven systems that lower costs, and thus prices, for buyers
Information systems are used primarily for capturing and distributing information in real-time about inventory, shipments, transactions, and costs
Systems are in place to avoid waste and to reward improvements in efficiency
core competencies (internal strengths)
Dependable distribution and supply chain operations
Capable customer service
Accurate forecasting and effective demand management