MGT499 CASE3, SLP3 and Thread Discussion
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Module 3 - Home
Strategic Planning & Strategy Formulation
Modular Learning Outcomes
Upon successful completion of this module, the student will be able to satisfy the following outcomes:
•Case ◦Discuss ways that environmental assessment efforts might be translated into strategy planning and formulation.
•SLP ◦Discuss ways that environmental assessment efforts might be translated into strategy planning and formulation.
◦Evaluate strategies and tactics used by organizations to gain competitive advantage.
•Discussion ◦Evaluate strategies and tactics used by organizations to gain competitive advantage.
Module Overview
Strategy Formulation and Planning
Once the environmental analysis is complete the organization should have a handle on what is happening in the environment from a political, economic, social, and technological perspective. The organization should also be cognizant of opportunities it might be able to capitalize on and potential threats looming on the horizon. Likewise it will have a stronger feeling for its own weaknesses and strengths. This information provides the organization with a realistic perspective as to what opportunities to seize and what must be done to overcome threats.
The next step, of course, constitutes the planning phase of the strategic management cycle. In this phase, the company must consider what was discovered during the environmental assessment phase and formulate a plan to optimize success. There are a lot of strategies that might be considered during the strategic planning phase. Here are a few examples of things you have likely seen companies do over the years.
•A company that is having difficulties getting raw materials for a reasonable price purchases one of its suppliers.
•A company discovers that the cost of manufacturing its product overseas is becoming more expensive than manufacturing the product domestically and begins building a manufacturing facility in the states.
•A company can no longer produce enough product to meet demand so it expands its operation.
•A company decides it is too diversified and that it needs to focus on the core technologies of the parent corporation so sells off some of its businesses.
•A company that makes ball bearings, has a reliable supplier and a reliable customer base with little change in the competitive landscape decides to keep doing things the way they always have.
•A company purchases one of its smaller competitors to eliminate the competition, acquire engineering expertise, and expand its customer base.
•A company buys a business in hopes of selling later for a profit.
•A company has gone through a difficult time so decides to restructure the organizational chain of command.
•A company decides to continue being the low-cost leader in the industry while still providing a quality product.
•A company decides to increase its marketing and R&D budget to make technological inroads and gain market share against a tough competitor.
These are just a few of the strategies that are common in the business world and this list is by no means all-inclusive. These strategies go by names like “Expansion, merger, differentiation, turnaround, and growth strategies.” Your text readings and other readings cover some of them more in depth.
