Environmental Scanning
Monitoring, evaluation, and disseminating information from external and internal environments –to key people in the firm.
SWOT Analysis
• Strengths – Weaknesses
• Opportunities – Threats
Environmental Variables
• Societal – technological, political, legal, social, economic
• Task/Industry – customers, suppliers, competitors
• Internal – structure, resources, culture
Strategy Formulation
Development of long-range plans for effective management of opportunities and threats in light of corporate strengths and weaknesses
Mission Statement
• Purpose/reason for organization
• Promotes shared expectations
• Communicates public image
• Who we are; what we do; what we aspire to
Corporate Goals/Objectives flow from the Mission/Vision statement
–Profitability (net profit)
–Growth –Resource utilization (ROE, ROI)
–Market leadership
Corporate Goals/Objectives need to be:
Specific
Measurable
Action oriented
Realistic
Timing is identified
Hierarchy of Strategy
Corporate strategy – general direction (stability, growth, retrenchment)
Business strategy – industry or market segment focus (competitive vs. cooperative)
Functional strategy – functional planning to support the Corporate and Business strategy. (technology leader or follower)