Company-Wide Strategic Planning:
Defining Marketing’s Role
Each company must find the game plan for long-run survival and growth that makes the most sense given its specific situation, opportunities, objectives, and resources. This is the focus of strategic planning—the process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities. Strategic planning sets the stage for the rest of planning in the firm. Companies usually prepare annual plans, long-range plans, and strategic plans. The annual and long-range plans deal with the company’s current businesses and how to keep them going. In contrast, the strategic plan involves adapting the firm to take advantage of opportunities in its constantly changing environment.
At the corporate level, the company starts the strategic planning process by defining its overall purpose and mission (see Figure 2.1). This mission is then turned into detailed supporting objectives that guide the entire company. Next, headquarters decides what portfolio of businesses and products is best for the company and how much support to give each one. In turn, each business and product develops detailed marketing and other departmental plans that support the company-wide plan. Thus, marketing planning occurs at the business-unit, product, and market levels. It supports company strategic planning with 38 more detailed plans for specific marketing opportunities.
Each company must find the game plan for long-run survival and growth that makes the most sense given its specific situation, opportunities, objectives, and resources. This is the focus of strategic planning—the process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities. Strategic planning sets the stage for the rest of planning in the firm. Companies usually prepare annual plans, long-range plans, and strategic plans. The annual and long-range plans deal with the company’s current businesses and how to keep them going. In contrast, the strategic plan involves adapting the firm to take advantage of opportunities in its constantly changing environment.
At the corporate level, the company starts the strategic planning process by defining its overall purpose and mission (see Figure 2.1). This mission is then turned into detailed supporting objectives that guide the entire company. Next, headquarters decides what portfolio of businesses and products is best for the company and how much support to give each one. In turn, each business and product develops detailed marketing and other departmental plans that support the company-wide plan. Thus, marketing planning occurs at the business-unit, product, and market levels. It supports company strategic planning with 38 more detailed plans for specific marketing opportunities.
Defining a Market-Oriented Mission
An organization exists to accomplish something, and this purpose should be clearly stated. Forging a sound mission begins with the following questions: What is our business? Who is the customer? What do consumers value? What should our business be? These simple-sounding questions are among the most difficult the company will ever have to answer. Successful companies continuously raise these questions and answer them carefully and completely. Many organizations develop formal mission statements that answer these questions. A mission statement is a statement of the organization’s purpose—what it wants to accomplish in the larger environment. A clear mission statement acts as an “invisible hand” that guides people in the organization
Some companies define their missions myopically in product or technology terms (“We make and sell furniture” or “We are a chemical-processing firm”). But mission statements should be market oriented and defined in terms of satisfying basic customer needs. Products and technologies eventually become outdated, but basic market needs may last forever. Under Armour’s mission isn’t just to make performance sports apparel; it’s “to make all athletes better through passion, science, and the relentless pursuit of innovation.” Likewise, Chipotle’s mission isn’t to sell burritos. Instead, the restaurant promises “Food with Integrity,” highlighting its commitment to the immediate and long-term welfare of customers and the environment. Chipotle’s serves only the very best natural, sustainable, local ingredients raised “with respect for the animals, the environment, and the farmers.” Table 2.1 provides several other examples of product-oriented versus market-oriented business definitions
An organization exists to accomplish something, and this purpose should be clearly stated. Forging a sound mission begins with the following questions: What is our business? Who is the customer? What do consumers value? What should our business be? These simple-sounding questions are among the most difficult the company will ever have to answer. Successful companies continuously raise these questions and answer them carefully and completely. Many organizations develop formal mission statements that answer these questions. A mission statement is a statement of the organization’s purpose—what it wants to accomplish in the larger environment. A clear mission statement acts as an “invisible hand” that guides people in the organization
Some companies define their missions myopically in product or technology terms (“We make and sell furniture” or “We are a chemical-processing firm”). But mission statements should be market oriented and defined in terms of satisfying basic customer needs. Products and technologies eventually become outdated, but basic market needs may last forever. Under Armour’s mission isn’t just to make performance sports apparel; it’s “to make all athletes better through passion, science, and the relentless pursuit of innovation.” Likewise, Chipotle’s mission isn’t to sell burritos. Instead, the restaurant promises “Food with Integrity,” highlighting its commitment to the immediate and long-term welfare of customers and the environment. Chipotle’s serves only the very best natural, sustainable, local ingredients raised “with respect for the animals, the environment, and the farmers.” Table 2.1 provides several other examples of product-oriented versus market-oriented business definitions
Mission statements should be meaningful and specific yet motivating. They should emphasize the company’s strengths in the marketplace. Too often, mission statements are written for public relations purposes and lack specific, workable guidelines. Says marketing consultant Jack Welch
Few leaders actually get the point of forging a mission with real grit and meaning. [Mission statements] have largely devolved into fat-headed jargon. Almost no one can figure out what they mean. [So companies] sort of ignore them or gussy up a vague package deal along the lines of: “our mission is to be the best fill-in-the-blank company in our industry.” [Instead,Welch advises, CEOs should] make a choice about how your company will win. Don’t mince words! Remember Nike’s old mission, “Crush Reebok”? That’s directionally correct. And Google’s mission statement isn’t something namby-pamby like “To be the world’s best search engine.” It’s “To organize the world’s information and make it universally accessible and useful.” That’s simultaneously inspirational, achievable, and completely graspable
Finally, a company’s mission should not be stated as making more sales or profits; profits are only a reward for creating value for customers. Instead, the mission should focus on customers and the customer experience the company seeks to create. Thus, McDonald’s mission isn’t “to be the world’s best and most profitable quick-service restaurant”; it’s “to be our customers’ favorite place and way to eat
Few leaders actually get the point of forging a mission with real grit and meaning. [Mission statements] have largely devolved into fat-headed jargon. Almost no one can figure out what they mean. [So companies] sort of ignore them or gussy up a vague package deal along the lines of: “our mission is to be the best fill-in-the-blank company in our industry.” [Instead,Welch advises, CEOs should] make a choice about how your company will win. Don’t mince words! Remember Nike’s old mission, “Crush Reebok”? That’s directionally correct. And Google’s mission statement isn’t something namby-pamby like “To be the world’s best search engine.” It’s “To organize the world’s information and make it universally accessible and useful.” That’s simultaneously inspirational, achievable, and completely graspable
Finally, a company’s mission should not be stated as making more sales or profits; profits are only a reward for creating value for customers. Instead, the mission should focus on customers and the customer experience the company seeks to create. Thus, McDonald’s mission isn’t “to be the world’s best and most profitable quick-service restaurant”; it’s “to be our customers’ favorite place and way to eat
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