Goal Formulation

Once the company has performed a SWOT analysis of the internal and external environments, it can proceed to develop specific goals for the planning period in a process called goal formulation. Managers use the term goals to describe objectives that are specific with respect to magnitude and time. Turning objectives into measurable goals facilitates management planning, implementation, and control.

To be effective, goals must (1) be arranged hierarchically to guide the businesses in moving from broad to specific objectives for departments and individuals; (2) be stated quantitatively whenever possible; (3) be realistic; and (4) be consistent. Other important trade-offs in setting goals include: balancing short-term profit versus long-term growth; balancing deep penetration of existing markets with development of new markets; balancing profit goals versus nonprofit goals; and balancing high growth versus low risk. Each choice in this set of goal trade-offs calls for a different marketing strategy.

Focus

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