Analyst Insights

Corporate-Wide Strategic Planning

Every company has to find a game plan to ensure long-term growth and survival that is most sensible considering its unique environment, potential, goals, and resources. This is the primary goal of strategic planning, which is the method of establishing and maintaining a fit between the company’s objectives and capabilities as well as the changing marketing possibilities.

Strategic planning establishes the framework for the remainder of the planning within the company. Businesses usually create annual plans, as well as long-range plans along with strategic and long-range plans. The long-range and annual plans focus on the company’s current operations and how they can continue to run them. However, the strategic plan focuses on preparing the company to make the most of opportunities in its ever-changing world. At the corporate level, the business initiates the strategic planning process by defining its primary goals and objectives. The mission is then translated into specific objectives to will guide the entire business.

The next step is to decide what product or portfolio of businesses is most beneficial for the business and the amount of support it will provide each. Each company and product creates detailed marketing plans as well as other plans for departments that support the overall plan of the company. Therefore, planning for marketing takes place at the unit, product, and market levels. It assists in strategic planning for the company by providing more specific strategies for specific opportunities in the market.

Arlin Jordin Washington

Market-Oriented Mission

A company exists to achieve something, and the reason must be stated clearly. Mission statements are a declaration of the purpose of the company and what it aims to accomplish in the greater context. A clearly defined mission statement functions like an unnoticed hand that directs employees within the company. Certain companies define their mission simply in technological or product terms, for instance, we manufacture and sell furniture or are a chemical processing firm. However, mission statements must be based on market research and focused on satisfying the basic needs of customers. Technologies and products are eventually obsolete. However, the fundamental needs of the market could last forever.

Setting Company Objectives and Goals

The business must translate its mission into detailed goals for all levels of management. Every manager should have goals and be accountable for achieving these goals. Marketing strategies and programs should be created to help achieve the goals of marketing.

Designing the Business Portfolio

Under the company’s mission and goals Management now has to create a business portfolio – the set of products and businesses which make up the firm. The most effective business portfolio is one that is the most appropriate to the strengths and weaknesses of the business to the opportunities that exist in the market. Business portfolio planning involves two steps. First, the business must review its existing portfolio of businesses and decide which companies require more, less, or even no investment. Then, it should define the future portfolio through the development of strategies to grow and reduce its size.

Arlin Jordin Washington

Analyzing the Current Business Portfolio

The primary task in strategic planning is portfolio analysis, in which management examines the businesses and products that comprise the business. The business may want to invest a lot of money into the most profitable ones and then reduce or eliminate the weaker ones.

The first step for management is to determine the most important companies that comprise the business, referred to as Strategic Business Units (SBUs). An SBU could be a division within the company or a departmental product line or even a specific item or brand. The business then evaluates the appeal of its different SBUs before deciding how much support each one deserves. When creating a portfolio of business. It’s best to include and assist businesses and products that are in line with the company’s fundamental philosophy and capabilities.

Growth-share matrix:

A method of portfolio planning that assesses the SBUs of a company by their market growth rate and the relative market share.

The most widely-used portfolio-planning technique was devised by the Boston Consulting Group, a prominent business consulting firm.5 It is the Boston Consulting Group Approach. Based on the now-classic Boston Consulting Group (BCG) approach, companies categorize each of their SBUs based on its growth-share matrix. On the vertical axis, the rate of market growth is an indication of the market’s attractiveness. In the horizontal direction relative market share is an indicator of the strength of the company within the markets.

Arlin Jordin Washington

The growth-share matrix identifies four types of SBUs.


Stars are high-growth, high-share companies or products. They typically require a large investment to fund their rapid expansion. In time, the growth slows and they’ll turn to cash-flow cows.

Cash Cows.

Cash cows are low-growth high-share products or businesses. Established and profitable SBUs require less capital to secure their market share. They also generate lots of cash used by the company to pay its expenses and help other SBUs which require investment.

Question Marks.

Question marks are business businesses in highly-growth markets. They need a significant amount of cash to keep their share, and even to increase it. Management must think long and hard about the questions it can build into stars and which ones need to be eliminated.


Dogs are low-growth, low-share companies, and products. They could bring in enough cash to support their operations, but they don’t promise to provide large amounts of cash.

Arlin Jordin Washington

Problems using Matrix Methodologies.

The BCG and other formal methods revolutionized the way we plan our strategy. However, these centralized methods are not without their limitations. They are often difficult to use, lengthy, and expensive to implement. Management might find it difficult to define SBUs and measure their market shares and growth. Additionally, these methods concentrate on categorizing the current business but offer little guidance for planning the future.