Strategic Planning, Problem Solving and Decisions

Chapter 3

Pio G. Castillo/BA100: Dana Tesone

Strategic Planning
It is the process of attaching strategies and tactics to each objective set for the organization.

Strategic Planning Components

Mission It describes its current purpose and values. It is why the organization exists.
Mission-driven organizations Will this activity help to
fulfill the mission?

Vision It describes the potential purpose and values of the organization at some point in the future.

Strategic Planning Components

Objectives These are targets for performance. Long-term objectives (LTO) more than a year to accomplish Short-term Objectives (STO) may be achieved in a year or less

Strategic Planning Process

Environmental Scanning External Scan Opportunities and Threats Internal Audit Strengths and Weaknesses

SWOT Analysis a form of situational analysis that aims to develop strategies that would convert weaknesses into strengths, and threats to opportunities

Strategic Planning Process

Strategy Formulation Audit the mission and vision Formulate objectives LTO strategies STO tactics Formulate policies broad guidelines that set standards for decision making and performance

Strategic Planning Process

Strategy Implementation This includes more tactical activities such as programs, budgets, procedures and rules.

Evaluation and Control It is the stage where you compare actual performance with standards of performance. Feedback/Learning Loop This provides for continuous evaluation and revision of the entire strategic plan.

Guidelines for Setting Objectives

SMART Individuals should participate in determining objectives. Personal objectives of workers should be considered within the context of organization objectives. All objectives should feed into the mission of the organization.

Levels of Strategies
Corporate Strategies broad strategies for the overall organization Business Strategies strategies initiated by specific business units (line) Functional Strategies strategies implemented by functional units (staff)

Business Cycle Phases and Strategic Planning Mode

Business Cycle Phase Introduction Growth Strategic Planning Mode Basic Financial Planning Forecast-based Planning Externally-oriented Planning (Strategic Planning) Strategic Management

Mature

Management Decisions

Unstructured Decisions

Strategic

Wider Span of Authority

Tactical Structured Decisions

Supervisory

Problem Solving
Problem It is the negative gap between actual performance and standards of performance. Identify the problem (not the symptoms) Generate three alternative solutions Evaluate alternatives (effectiveness and efficiency) Choose optimum alternative Provide feedback