Strategic Planning Flashcards
What is a value proposition?
A 30 second “elevator speech” stating the specific value a product or service provides to a target market. Shows why the product or service is superior to competing offers and why the customer should buy it or why a firm should hire you.
Corporate level plans
Plans developed for the corporation as a whole take place at the corporate level.
Strategic business unit (SBU)
Businesses or product lines within an organization that have their own competitors, customers, and profit centers.
Business level plans
Plans developed for each strategic business unit typically have their own mission statement.
First-mover strategy
Corporate level strategy theorizing that being the first organization to off a product in the marketplace will be the long-term market leader
Second-mover strategy
Corporate level strategy theorizing that closely observing the innovations of the first movers, and improving on them can help an organization gain an advantage in the marketplace.
Strategic planning process
A process that helps an organization allocate its resources under different objectives, deliver value, and be competitive in the market driven economy.
Situation analysis
An assessment of an organization’s internal and external environments
SWOT analysis
An acronym for strengths, weaknesses, opportunities, and threats. Is a tool that frames the situational analysis
Mystery shoppers
A person who is paid to shop at a firm’s establishment or one its competitors’ to observe the level of service, cleanliness of the facility, and report their findings to the firm.
Green Marketing
Marketing environmentally safe products and services in a way that is good for the environement
Mission statement
Defines the purpose of the organization and answers the question of how a company defines its business
Objectives
What organizations want to accomplish (the end results) in a given time frame.
Strategies
Actions (means) taken to accomplish objectives
Marketing Plan
A document that is designed to communicate the marketing strategy for an offering. The purpose is to influence executives, suppliers, distributors, and other important stakeholders of the firm so they will invest money, time, and effort to ensure the plan is a success.
Market penetration strategies
Selling more of existing products and services to existing customers
Product development strategies
Creating new products of services for existing markets
Market development strategies
Selling existing products or services to new customers. Foreign markets often present opportunities for organizations to expand. Exporting, licensing, franchising, joint ventures, and direct investment are methods that companies use to enter international markets.
Exports
Sell products to buyers in foreign markets
License
Sell the right to use some aspect of the production process, trademark, or patent to individuals in foreign markets
Franchising
Granting an independent operator the right to use your company’s business model, techniques, and trademarks for a fee
Contract Manufactoring
When companies hire manufacturers to produce their products in another company
Joint Ventures
An entity that is created when two parties agree to share their profits, losses, and control with one another in an economic activity they jointly undertake
Direct investment
Owning a company or facility overseas
Diversification strategies
Offering products that are unrelated to other existing products produced by the organization
Portfolio
A group of business units owned by a single firm
Portfolio planning approach
Analyzing a firm’s entire collection of businesses relative to one another.
Boston Consulting Group (BCG) matrix
A portfolio planning approach that examines strategic business units based on their relative market shares and growth rates Businesses are classified as stars, cash cows, question marks (problem children), or dogs.
Star
Business or offering with high growth and a high market share
Cash Cows
Business or offering with a large share of a shrinking market
Question marks or problem children
Businesses or offerings with a low share of a high-growth market
Dogs
Business or offering with low growth and a low market share
Harvest
When a firm lowers investment in a product or business
Divest
When a firm drops or sells a business or product
General Electirc (GE) approach
A portfolio planning approach that examines a business’s strengths and the attractiveness of industries
