Unit 3 -21Oct2023
## Planning
Planning is the process of establishing goals, policies, and procedures for a social or economic unit,
such as a city or a business. In the context of business management, planning is one of the primary
duties of managers at all levels. It involves ascertaining what needs to be done and how to do it, and
it is firmly correlated with discovery and creativity. The planning process can be broken down into
several steps, including setting objectives, developing tasks to meet those objectives, and
determining the resources needed to accomplish them.
## Strategic Planning Process - Business and Corporate Level
Strategies
Strategic planning is a companywide approach at the business unit and corporate level for
developing long-term strategic plans to achieve a vision. It involves defining the corporate strategic
goals and intentions at the top and cascading them through each level of the organization. There are
two main levels of strategic planning:
- **Business level strategy**: This is the sum of the strategic planning and implementation
activities that set and steer the direction of an individual business. It focuses on achieving a
competitive advantage in a specific market or industry and involves making decisions about
products, customers, and competitors.
- **Corporate level strategy**: This level of strategic planning focuses on the overall
direction and scope of the entire organization. It includes decisions about which businesses to be in,
how to allocate resources among different business units, and how to create synergies among them.
The strategic planning process involves several steps, such as clarifying the vision and mission of the
organization, conducting a competitive analysis, and developing an effective strategic planning
framework.
## Decision Making Process
Decision making is the process of making choices by identifying a decision, gathering information,
and assessing alternative resolutions. A step-by-step decision-making process can help individuals
and organizations make more deliberate and thoughtful decisions. The decision-making process
typically includes the following steps:
1. **Identify the decision**: Clearly define the nature of the decision that needs to be made.
2. **Gather relevant information**: Collect the necessary information to understand the
situation and the available alternatives.
3. **Identify the alternatives**: Generate a list of possible options or solutions.
4. **Weigh the evidence**: Evaluate the pros and cons of each alternative.
5. **Choose among alternatives**: Select the alternative that seems to be the best one based
on the evaluation.
6. **Take action**: Implement the chosen alternative.
7. **Review the decision and its consequences**: Evaluate the results of the decision and, if
necessary, make adjustments or repeat certain steps of the process.
## Decision Making Techniques
There are various decision-making techniques that can be used to improve the quality of decisions.
Some of the most common techniques include:
- **SWOT Analysis**: A technique for identifying an organization's strengths, weaknesses,
opportunities, and threats.
- **Cost-Benefit Analysis**: A method for comparing the costs and benefits of different
alternatives.
- **Pareto Analysis**: A technique for identifying the most significant factors or problems.
- **Brainstorming**: A group technique for generating creative ideas and solutions.
- **Force Field Analysis**: A method for analysing the forces that are driving and restraining a
particular situation.
By applying these techniques, individuals and organizations can make better decisions by
considering a range of factors, evaluating alternatives, and understanding the potential risks and
benefits of different options.
Here are some examples:
**Planning Process: **
- Developing objectives: A mobile phone company sets an objective to increase its market share by
10% in the next quarter
- Developing tasks to meet objectives: The company identifies tasks such as hiring salesmen, creating
TV advertisements, and starting online marketing activities.
- Allocating resources: The company organizes for labour, purchases machinery, and sets up service
workshops- Creating a timeline: The company sets deadlines for the completion of tasks and the
achievement of objectives.
- Determining tracking and assessment: The company establishes methods to monitor progress and
evaluate the effectiveness of the plan.
- Follow-up action: The company continuously monitors the plan, takes feedback, and ensures that
activities are being performed according to schedule.
**Strategic Planning: **
- Mission and vision: A company's mission is to provide affordable and innovative technology
solutions, while its vision is to be a global leader in the industry.
- Goals: The company sets goals such as expanding into new markets, increasing profitability, and
improving customer satisfaction
Objectives: The company establishes specific and measurable objectives, such as increasing market
share by 5% and launching three new products in the next year
- Strategies: The company develops strategies to achieve its objectives, such as entering strategic
partnerships, investing in research and development, and improving operational efficiency.
- Tactics: The company implements tactics, such as identifying and inviting speakers for an annual
client conference, to support its strategies
**Business-Level Strategy: **
- Differentiation: A company differentiates its offerings by providing unique features, high-quality
products, and exceptional customer service
- Cost leadership: A company focuses on reducing costs and offering products or services at a lower
price than its competitors
- Focus: A company targets a specific market segment or niche and tailors its products or services to
meet the needs of that segment
**Corporate-Level Strategy: **
- Diversification: A company expands its business into new markets or industries to reduce risk and
take advantage of growth opportunities
- Vertical integration: A company acquires or merges with suppliers or distributors to gain more
control over its supply chain
- Global expansion: A company enters international markets to increase its customer base and
access new resources