• Strategic planning
• The process of developing and maintaining a strategic fit btw the org.’s goals
and capabilities and its changing marketing opp.
Defining the company’s Setting objectives and Designing the business Planning marketing and
mission goals portfolio other functional
• Mission statement
• A statement of the organization’s purpose - what it wants to accomplish in the
Clear statement acts as an ‘invisible hand’ that guides people in the org.
• Better org. and financial performance
• Should be meaningful, specific, motivating, market oriented and defined in
terms of satisfying basic customer needs.
• Should emphasize the company’s strength in the marketplace
• Should not be stated as making more sales or profits (profits are only a reward
for creating value for customers)
Make employees feel that their work is sig. and that it contributes to ppl’s
• Business portfolio
• The collection of businesses and products that make up the company.
• Fits the company’s S, W, O in the env.
1. Analyze its current business portfolio, decide which business should
receive more, less or no investment.
• Portfolio analysis
• The process by which management evaluates the products and
businesses that make up the company.
• Put strong resources in profitable businesses and drop the weaker
• Company division, product line within a division, a single product
• Attractiveness of the SBUs --> Amount of support each deserves • Boston Consulting Group Approach (BCG)
• Classifies all its SBUs according to the growth-share matrix
• Growth-share matrix
• Portfolio planning method that evaluates a company’s
SBUs in terms of its market growth rate and relative market
MarketGrowthRate High Star Question Mark
Need heavy investments to Decide which should be built
finance rapid growth into stars or phased out
• Build • Build, harvest or divest
Low Cash Cow Dog
• Successful • May generate enough cash to
• Produce lots of cash that the maintain themselves but isn’t
company uses to pay its bills guaranteed to be large sources
and support other SBUs of cash
• Harvest or hold • Harvest or divest
• Increase market share •Increase S-T cash flow
• Question mark and stars •Weak cash cows, question marks and
• Preserve market share •Sell or liquidate
• Cash cows •Question mark and dogs
• Difficult, time-consuming and expensive
• Provide little advice for future planning
2. Shape the future portfolio by developing strategies for growth and
• Product/market expansion grid
• A portfolio-planning tool for identifying company growth opp. through
market penetration, market development, product development, or