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WHAT IS STRATEGIC BUSINESS PLANNING?

Strategic business planning is a problem-solving and decision-making effort that forces management to look at the future and develop courses of action that are appropriate for the external conditions the organization faces. Strategic planning is a
process in which objectives, strategies, and execution details are clearly identified. Objectives outline what is to be accomplished (e.g., sales growth, market share growth, and so on); strategies indicate how the objectives will be achieved (e.g., time and resources required); and execution outlines the tactical details of the strategy (e.g., specific activities, their costs and timing). Strategic business planning typically starts and ends with the senior executives of an organization.

HOW DOES CORPORATE PLANNING INFLUENCE THE NATURE AND DIRECTION OF MARKETING PLANNING?

In a business organization, two separate but related plans work together to achieve growth objectives. A corporate plan provides direction to a marketing plan; a marketing plan provides direction to the various components of marketing, such as product strategy and marketing communications strategy. Each plan has its own objectives, strategies, and execution details. Corporate planning starts with the development of a mission and vision statement, followed by corporate objectives and strategies. These plans consider both the short term and the long term and their objectives are financial in nature. The objectives are stated in terms of growth in sales, profit, return on investment, and market share.

Some of the more common corporate strategic alternatives include penetration strategies that focus on more aggressive marketing, acquisition strategies, newproduct development programs, forming strategic alliances, vertical and horizontal integration strategies, and divestment strategies. Large business organizations often combine several of these strategies.

Strategic marketing planning involves reviewing and analyzing relevant background information, establishing appropriate marketing objectives, devising a positioning strategy, identifying target markets, devising marketing strategies (utilization of the marketing mix) and marketing executions (specific action plans to implement the strategies), accessing budget support, and implementing control procedures. Such plans are developed on an annual basis. The more commonly used product marketing strategies include market penetration, market development, product development, and diversification.

HOW DO MARKETERS EVALUATE THE EFFECTIVENESS OF THEIR MARKETING PLANS?

Once the marketing plan is implemented it is subject to evaluation. The evaluation and control process attempts to draw relationships between strategic activities and results. The organization determines which activities are effective or ineffective and then alters its strategy as needed. The marketing plans (the performance of the product based on the plan) are reviewed at predetermined intervals during the course of a year. Corrective action is implemented when necessary. Due to uncertainty in the marketplace, wise marketing planners build contingency plans into the overall marketing plan. Such plans force planners to consider in detail the environments that influence marketing activities.