The Strategic and Operational Planning ProcessLearning OutcomesLearning Outcomes (cont’d)PlanningPlanning DimensionsTypes of PlansTypes of Plans (cont’d)Slide 8Standing versus Single-Use PlansPowerPoint PresentationSlide 11Strategic and Operational PlanningThe Strategic ProcessStrategic PlanningStrategic and Operational LevelsIndustry and Competitive Situation AnalysisStarbuck’s Five-Force Competitive AnalysisCompany Situation Analysis StepsSWOT Analysis for Starbucks CoffeeCompetitive Strength Assessment for Starbucks CoffeeCompetitive AdvantageSetting ObjectivesWriting Objective ModelCriteria That Objectives Should MeetManagement by Objective (MBO)Corporate-Level StrategyCorporate Grand and Growth StrategiesPortfolio Analysis: BCG MatrixThe Entrepreneurial Strategy MatrixThe Entrepreneurial Strategy Matrix: Appropriate StrategiesBusiness-Level StrategiesSelecting Adaptive StrategiesSlide 33Competitive StrategiesProduct Life Cycle: StarbucksSlide 36Functional-Level Operational StrategiesFunctional-Level Operational Strategies (cont’d)PowerPoint Presentation by Charlie CookPowerPoint Presentation by Charlie CookThe Strategic and Operational The Strategic and Operational Planning ProcessPlanning ProcessThe Strategic and Operational The Strategic and Operational Planning ProcessPlanning ProcessChapter 5Chapter 5Chapter 5Chapter 5Copyright Copyright © © 2003 South-Western/Thomson Learning. All rights reserved.2003 South-Western/Thomson Learning. All rights reserved.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–2Learning OutcomesLearning OutcomesCopyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–3Learning Outcomes (cont’d)Learning Outcomes (cont’d)Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–4PlanningPlanning•Planning Dimensions –The level of management developing the plan–The type of plan (strategic or operational)–The scope of the plan (broad or narrow)–The time horizon of the plan (short- or long-term)–The plan’s repetitiveness (standing or single-use)Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–5Planning DimensionsPlanning DimensionsExhibit 5–1Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–6Types of PlansTypes of Plans•Standing Plans–Policies, procedures, and rules developed for handling repetitive situations.–Policies•General guidelines to be followed when making decisions.–Procedures•A sequence of actions to be followed in order to achieve an objective.–Rules•A statement of exactly what should or should not be done.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–7Types of Plans (cont’d)Types of Plans (cont’d)•Single-Use Plans–Programs and budgets developed for handling nonrepetitive situations.–Program•A set of activities designed to accomplish an objective over a specified period of time.–Program development•Set project objectives.•Break the project down into a sequence of steps.•Assign responsibility for each step.•Establish starting and ending times.•Determine the resources needed for each step.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–8Types of Plans (cont’d)Types of Plans (cont’d)•Single-Use Plans–Budget•Represents the funds allocated to operate a unit for a fixed period of time.•Is a planning tool initially and becomes a control tool after implementation of the plan.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–9Standing versus Single-Use PlansStanding versus Single-Use PlansExhibit 5–2Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–10Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–11Types of Plans (cont’d)Types of Plans (cont’d)•Contingency Plans–Alternative plans to be implemented if uncontrollable events occur.–Developing a contingency plan•What might go wrong in my department?•How can I prevent it from happening?•If it does occur, what can I do to minimize its effect?•Why Managers Don’t Plan–Claimed lack of time–Tendency toward actionCopyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–12Strategic and Operational PlanningStrategic and Operational Planning•Strategic Planning–The process of developing a mission and long-range objectives and determining in advance how they will be accomplished.•Operational Planning–The process of setting short-range objectives and determining in advance how they will be accomplished.•Strategy– A plan for pursuing the mission and achieving objectives.Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–13The Strategic ProcessThe Strategic ProcessExhibit 5–3Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–14Strategic PlanningStrategic Planning•Corporate-Level Strategy–The plan for managing multiple lines of businesses•Business-Level Strategy–The plan for managing one line of business•Functional-Level Strategy–The plan for managing one area of the businessCopyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–15Strategic and Operational LevelsStrategic and Operational LevelsExhibit 5–4Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–16Industry and Competitive Situation AnalysisIndustry and Competitive Situation Analysis•Situation Analysis–Draws out those features in a company’s environment that most directly frame its strategic window of options and opportunities.•Five Competitive Forces (Porter)–Rivalry among competing sellers in the industry–Threat of substitute products and services–Potential new entrants–Power of suppliers–Power of buyersCopyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–17Starbuck’s Five-Force Competitive AnalysisStarbuck’s Five-Force Competitive AnalysisExhibit –5Copyright © 2003 by South-Western/Thomson Learning. All rights reserved. 5–18Company Situation Analysis StepsCompany Situation Analysis StepsExhibit 5–61. Assessment of the present strategy based on performance.1. Assessment of the present strategy based on performance.2. SWOT analysis.2. SWOT analysis.3. Competitive Strength Assessment (competitive advantage).3. Competitive Strength Assessment