Strategic Business Planning: Vision, Units, and Market Analysis

Posted on Sep 10, 2025 in Marketing

Strategic Selection and Tactics

A strategy is a set of actions whose impact is felt in the long term. Actions with objectives expected in the short term, which may not always align with the overall strategy, are called tactics.

Integrating Philosophy, Mission, Objectives, and Strategy

Effective strategic management integrates several core components:

  • Philosophy: Conceptualizes the future vision of the organization.
  • Purpose & Values: Forms the foundation for the mission.
  • Mission: Defines the organization’s fundamental purpose.
  • Analysis: Involves analyzing the competitive environment and conducting internal analysis (e.g., SWOT).
  • Long-Term Goal Planning: Identifies and evaluates alternative strategies.
  • Culture Implementation: Ensures the organizational culture supports the strategy.
  • Leadership & Motivation: Drives the strategic management control system, aligning budgets with functional strategies.

Strategic Business Units (SBUs)

A Strategic Business Unit (SBU) is an operating unit within an organization that sells distinct products or services to an identifiable group of customers. Each SBU typically has its own mission and objectives, operating almost as an independent business.

SBUs and the Corporate Structure

A corporation is a unified entity that brings a group of Strategic Business Units (SBUs) under its strategic direction. Essentially, a corporation comprises multiple SBUs, each contributing to the overall corporate strategy.

Strategic Decision-Making Process

The strategic decision-making process typically follows a cycle of events:

  1. Senior management determines the organization’s philosophy, mission, objectives, and corporate strategy.
  2. Strategic Business Units (SBUs) then conduct their own strategic planning.
  3. If the organization has a dedicated planning department, its function is to assist the SBUs.
  4. Senior management reviews and approves the strategic plan of each SBU.
  5. SBUs then develop functional plans for each of their functional areas (e.g., marketing, finance, operations).
  6. After the development of strategic plans for the SBUs, budgets are allocated.
  7. Functional managers are ultimately responsible for key processes that determine and serve the functional strategies.

Levels of Strategy

  • Corporate Strategy: Concerned with identifying the business areas in which the corporation is interested in participating. It defines the overall scope and direction of the organization.
  • SBU Strategy: Focused on improving the competitive position of a Strategic Business Unit against its competitors within its specific market.
  • Functional Strategy: Supports the SBU by detailing how each functional area (e.g., marketing, human resources, operations) will contribute to the SBU’s success.

Environmental Analysis: Macro and Micro Factors

Effective strategic planning requires a thorough environmental analysis, encompassing both macro and micro factors. This process involves the identification of:

  • Opportunities and Threats: Derived from the external macro-environment.
  • Strengths and Weaknesses: Identified through internal analysis.
  • Critical Success Factors: Key elements in the micro-environment that determine competitive success.
  • Competitive Advantages: Unique attributes that allow an organization to outperform competitors.

Key Environmental Factors

Relevant environmental factors to consider include:

  • Macro-Environmental Factors (PESTEL):
    • Political
    • Economic (e.g., macro-economics)
    • Social
    • Technological
    • Environmental (Ecological)
    • Legal

    These forces, among others, shape the broader context in which businesses operate.

  • Micro-Environmental Factors:
    • Customers
    • Competitors
    • Suppliers
    • Intermediaries
    • Publics

Implementing an Environmental Analysis Program

To effectively implement an environmental analysis program, consider the following:

  • Organizational Placement: Determine where the program will be located within the organizational structure.
  • Information Sources: Identify and examine relevant sources of information.
  • System Implementation: Define the system to be used for program execution.

Action Steps for Environmental Scanning:

  1. Appoint a senior director to lead the analysis.
  2. Identify a comprehensive list of relevant publications (e.g., 100 publications).
  3. Assign one publication per person for review.
  4. Archive each relevant journal article.
  5. Assign a default key code or categorization.
  6. Code and submit findings for consideration by a committee.
  7. Computerize codes and extract key insights.
  8. Prepare a circular or summary report.
  9. Encourage active participation from managers.
  10. Track and analyze the results of these actions.

Environmental Forecasting Techniques

Several techniques can be employed for environmental forecasting:

  • Delphi Method: Analyzes economic, political, and social trends by soliciting and consolidating expert opinions through a series of questionnaires.
  • Brainstorming: A technique primarily used to produce creative ideas for problem-solving. It involves presenting a question to a group, allowing them to freely present their forecasts and ideas.
  • Scenario Planning (Scripts): Involves creating written narratives that describe plausible future states or scenarios, helping organizations prepare for various possibilities.

Impact-Trend Analysis Steps:

  1. Extrapolate the past history of a particular phenomenon.
  2. A panel of experts specifies a set of future conditions or events.
  3. The panel indicates how these conditions or events might affect the phenomenon.
  4. Computer models are used to modify the forecasts based on specified criteria.
  5. The panel of experts reviews and modifies the inputs and results.