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Chapter 2

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Department
Business Administration
Course
BUS 343
Professor
Zaheer Jiwani
Semester
Winter

Description
Chapter 2 Business planning: plan well and prosper Business planning: An ongoing process of making decisions that guide the firm both in the short term and for the long term. Business plan: A plan that includes the decisions that guide the entire organization. Marketing plan: A document that describes the marketing environment, outlines the marketing objectives and strategy, and identifies who will be responsible for carrying out each part of the marketing strategy.  Level of planning **** business planning usually occurs on an annual basis at three levels—strategic planning,marketing palnning, and operational planning.**** Strategic planning: A managerial decision process that matches an organization’s resources and capabilities to its market opportunities for long-term growth and survival. (ppt) Strategy: What a firm is going to do to achieve an objective. Tactics: How a strategy is going to be enacted. SBU(strategic business unit): A semi-autonomous entity that operates as an independent business with its own mission and objectives-and its own marketing strategy. Functional planning (Marketing planning): A decision process that concentrates on developing detailed plans for strategies and tactics for the short term, supporting an organization’s long-term strategic plan. Operational planning: Planning that focuses on the day-to-day execution of the functional plans and includes detailed annual, semiannual, or quarterly plans. Strategic planning: guiding the business  Step1: define the mission Mission statement: A formal statement in an organization’s strategic plan that describes the overall purpose of the organization and what it intends to achieve in terms of its customers, products, and resources. ****the ideal mission statement is not too broad, too narrow, or too shortsighted.****  Step2: evaluate the internal & external environment  External environment External environment: The uncontrollable elements outside of an organization that may affect its performance either positively or negatively. These include macro environment factors like regulatory or technology factors, consumer behavior trends, industry factors such as industry concentration, and competitive factors such as the number and sophistication of competitors. PESTO: Political (including legal or regulatory), economic, social or cultural, technological, or other trends or issues that might impact a particular industry and business.  Internal environment Internal environment: The controllable elements inside an organization-including its people, its facilities, and how it does things-that influence the operations of the organization.  Step3: Set organizational or SBU objectives **** objectives need to be specific, measurable, and attainable****  Step4: establish the business portfolio Business portfolio: The group of different products or brands owned by an organization and characterized by different income-generating and growth capabilities. Portfolio analysis: A tool management uses to assess the potential of a firm’s business portfolio. BCG growth-market share matrix: A portfolio analysis model developed by the Boston Consulting Group that assesses the potential of successful products to generate cash that a firm can then use to invest in new products.  Step5: Develop growth strategies ****although the BCG matrix can help managers decide which SBUs they should invest in for growth, it doesn’t tell them much about how to make the growth happen. Should the growth of an SBU come from finding new customers, from developing new variation of the product, or from some other
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