MODULE 2

• Strategic Planning it is a process that helps an organization allocate its resources to capitalize on opportunities in the marketplace. Typically, it is a long-term process.
• The strategic planning process includes conducting a situation analysis and developing the organization’s mission statement, objectives, value proposition, and strategies.
• 3 Levels of Strategy

  1. Corporate Strategy
  2. Business Strategy
  3. Functional Strategy
• Corporate Level Strategy covers the entire business in a complex organizations where there are multiple business, divisions, or operating units.
• Corporate-level strategy sometimes called as strategic business units.
• Corporate-level strategies are formulated and implemented by upper management.
• Business level strategy is a strategic plan created for a single business or operating unit, and these plans are generally developed by middle management to support the corporate-level strategy.
• Corporate-level and business level strategies lead to the development of functional strategy.
• 5 Steps in Strategic Planning

  1. Define the Vision Statement
  2. Establish the Mission Statement
  3. Perform a Gap Analysis
  4. Establish objectives and goals
  5. Monitor the progress
• Acronym of BCG: Boston Consulting Group
• The BCG Matrix is a model developed by Boston Consulting Group that can be used to analyze a business's product lines or SBUs and make decisions about which to invest in the future and which they should try to minimize further investment in or even eliminate.
• Stars: High growth and high share businesses or products.
• Stars: They are need heavy investments to sustain the rapid growth and they will be the market leader of their industry or category.
• Cash Cows: They are low growth, high market share businesses products.
• Cash Cows: They are well established in their target market and require very little investment to hold their market share.
• Cash Cows: They generate enough cash for the business to run and maintain other SBUs.
• Dogs: Are a low market growth rate, low market share businesses, and products.
• Dogs: They are generate enough cash to maintain themselves but do not promise to be large sources of cash.
• Dogs: They are used killed off to maintain the profitability of other SBUs.
• Questions Marks: Are a low share business units and high growth markets and they are require a lot of cash to hold their share, let alone increase it.
• Questions Marks: Management has to think hard about which questions it should try to build into stars and which should be phased out.
• SWOT analysis: It is a framework to help assess and understand the internal and external forces that may create opportunities or risks for

  an organization.
• Strengths and weaknesses: Internal factors
• Strengths and weaknesses: They are characteristics of a business that give it a relative advantage (or disadvantage, respectively) over its competition.
• Opportunities are elements of the external environment that management can seize upon to improve business performance (like revenue growth or improved margins).
• The primary goal of market penetration is to increase market share or sales of existing products in the current market.
• Market Penetration Strategy: This could involve aggressive pricing, advertising, promotions, or other tactics to gain a larger share of the current market.
• The approach of marketing penetration strategy of companies is to be employing this strategy focus on selling more of their current products to their existing customer base or attracting new customers within the same market.
• Product development aims to introduce new products

  or services to existing markets.
• Product diversification involves entering new markets with new products. The goal is to reduce risk by not relying solely on existing products or markets.
• 3 Types of Diversification Technique:

  1. Concentric Diversification
  2. Horizontal Diversification
  3. Conglomerate Diversification
• Concentric Diversification - Expanding into new products or

  markets related to the company's current business.
• Horizontal Diversification - Adding new, unrelated products or

  services to the existing business.
• Conglomerate Diversification - Expanding into entirely new and

  unrelated business areas.