Strategic planning

Strategic planning in industrial markets

two significant differences w.r.t consumer markets
1. multiplicity of customers like commercial enterprise to resellers
2. If custom built, higher degree of integrated effort in the
departments

Problems and solution

Functional isolation
Functional conflict
Alleviating conflict

Design organizations to be competitive rather than efficient

360 degree appraisal
rotate jobs the Sony way
 Planning process..
1. Corporate mission – a directing force,
invisible hand, purpose
“to solve unsolved problems innovatively”
 HMT Ltd
Corporate

Machine Watches Tractor

Division Division Division Divisional

Hand wound Quartz

Automatic Business Unit

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 Desired
Desired
sales
sales
Diversification growth
Strategic-
planning
Integrative growth gap
Sales

Intensive growth

Current
Current
portfolio
portfolio

0 5 10
Time (years)
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Ansoff Market/Product
Matrix
MARKETS
OLD/EXISTING NEW

OLD/EXISTING Market Market

Penetration Development
PRODUCT
S Product
NEW Diversification
Development
Market Growth Rate

Stars Question marks

4
3
?2 ? 1
5 ?

?
Cash cow Dogs
8
6 7

Relative Market Share

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 BUSINESS STRENGTH
Strong Medium Weak
1.00
MARKET ATTRACTIVENESS

5.00 3.67 2.33

5.00
Low Medium High

3.67

2.33

1.00
Invest/grow Selectivity/earnings Harvest/divest
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Porters Generic
Scope of Target market Vs RoI

Focus Cost
leadership
R
O Diff
I

Narrow
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 Structure
Structure

Strategy
Strategy Systems
Systems

Shared
Shared
values
values
Skills
Skills Style
Style

Staff
Staff
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 Role of Marketing in SPP

Ability of marketing to scan environment

Ability of Marketing to give lead for NPD
Functional departments involvement being
high, marketing should champion the cause.