Planning and - Planning and Budgeting Strategic Management involves developing a grand strategy strategic planning implementation and control A

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Planning and Budgeting Strategic Management involves developing a grand strategy, strategic planning, implementation, and control. A grand strategy describes how the organization’s mission is to be achieved. It is based on a situational analysis that considers organizational strengths and weakness (a capability profile) and their interactions with environmental opportunities and threats. Strategic Planning/Analysis is the process of setting overall long-term objectives and drafting strategic plans to establish the general direction of an organization. It includes (1) Identifying organizational objectives (2) Evaluating the strengths and weaknesses of the organization (3) Assessing risk levels (4) Identifying and forecasting the effect of external (environmental) factors relevant to the organization (such as market trends, changes in technology, international competition, and social change) (5) Deriving the best strategy for reaching the objectives given the organization’s strengths and weaknesses and the relevant future trends (6) Analyzing and reviewing the capital budgeting process and capacity planning Michael Porter’s model of the value creation chain Primary activities include: - Inbound logistics : the firms’ capture of materials to be processed. - Operations : conversion processes. - Outbound logistics : shipment of products. - Marketing and sales : the promotion and sale of final products. - Service : provide customer service Support activities include: infrastructure (e.g. administration, finance, and planning), procurement, human resources, and technology development 5 Steps of the product life cycle 1) Development – during product development, the company has no sales and high investment costs. 2) Introduction – characterized by slow sales growth and lack of profits due to the higher expenses of promotion and distribution. Competitors are few, basic versions of the product are produced, and higher-income customers are usually targeted. 3) Growth – Sales and profits increase rapidly, new competitors enter an
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This note was uploaded on 02/01/2009 for the course ACTG 6610 taught by Professor Ward during the Spring '09 term at Middle Tennessee State University.

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Planning and - Planning and Budgeting Strategic Management involves developing a grand strategy strategic planning implementation and control A

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