The Strategic Plan

The strategic plan contains several components: the mission, the strategic objectives, the strategic audit, SWOT analysis, portfolio analysis, objectives and strategies. All of these feed from and feed into marketing plans.

The Mission

A mission states the purpose of a company. Firms often start with a clear mission held within the mind of their founder. Then, over time, the mission fades as the company acquires new products and markets. A mission may be clear, but forgotten by some managers. An extreme ease of this was the Anglican Church Commissioners, who thought they had the 'Midas touch' when they started speculating on the international property market. They found out that markets go down as well as up and lost a third of the Church's ancient wealth in the process. Other problems can occur when the mission may remain clear, but no longer fits the environment. The Levi preview shows that company struggling with this problem.

When an organization is drifting, the management must renew its search for purpose. It must ask: What business are we in? What do consumers value? What are we in business for? What sort of business are we? What makes us special? These simple-sounding questions are among the most difficult that the company will ever have to answer. Successful companies continuously raise these questions and answer them. Asking such basic questions is a sign of strength, not uncertainty.

Imagine thousands of innovations that make work easier no matter where you work.

Mission Statement Sales

Company mission: 3M states its mission not as making office products, but as creating innovations tiu.it 'make your work- make your life - simpler, more efficient, more productive:.'

88 • Chapter ,1 Strategic Marketing Planning mission statement A statement of the organisations purpose •what it -wants to accomplish in the environment.

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, so that they can work independently and yet collectively towards overall organizational goals.

Traditionally, companies have defined their business in product terms ('we manufacture furniture'), or in technological terms ('we are a chemical-processing firm'). But mission statements should be market-oriented.

WllAT BUSINESS ARE WE IN? Asking this question helps. Market definitions of a business are better than product or technological definitions. Products and technologies eventually become outdated, but basic market needs may last for ever. A market-oriented mission statement defines the business based on satisfying basic customer needs. Thus Rolls-Royce is in the power business, not the aero-engine business. Visa's business is not credit cards, but allowing customers to exchange value - to exchange assets, such as cash on deposit or equity in a home, for virtually anything, anywhere in the world. Creative 3M does more than just make adhesives, scientific equipment and healthcare products; it solves people's problems by putting innovation to work for them.

Wl-IO ARE OUR CUSTOMERS? This is a probing question. Who are the customers of Rolls-Royce's new Trent aero-engine? At one level it Is the airframers, like Boeing and European Airbus. If Rolls-Royce can get an airframer to launch a new aircraft with a Rolls-Royce engine, this saves development costs and makes early orders likely. Is it the airline or leasing companies that eventually buy the engines? They will certainly have to sell to them as well. Is it (he pilot, the service crew or even the passenger? Unlike the competition, RollsRoyce has a brand name that is synonymous with prestige and luxury.

WHAT ARE WE IN BUSINESS FOR? This is a hard question for non-profit-making organizations. Do universities exist to educate students or to train them for industry? Is the pursuit of knowledge by the faculty the main reason for their existence? If so, is good research of economic value or is pure research better?

WHAT SORT OF BUSINESS ARE WE? This question guides die strategy and structure of organizations. Companies aiming at cost leadership seek efficiency. These firms, like Aldi or KwikSave, run simple, efficient organizations with careful cost control. These contrast with differentiators, like Sony, who aim to make profits by inventing products, such as the Walkman, whose uniqueness gives a competitive edge. Focused companies concentrate upon being the best at serving a well-defined target market. They succeed by tailoring their products or services to customers they know well. In Britain, Coutts & Co., a National Westminster Bank subsidiary, does this by providing 'personal banking' to the very wealthy. Michael Porter4 describes a fourth option that occurs if firms do not define how they are to do business: stuck in the middle.

Management should avoid making its mission too narrow or too broad. A lead-pencil manufacturer that says it is in the communieation equipment business is stating its mission too broadly. A mission should be:

• Realistic. Singapore International Airlines is excellent, but it would be deluding itself if its mission were to become the world's largest airline.

• Specific. It should fit the company and no other. Many mission statements exist for public-relations purposes, so lack specific, workable guidelines. The statement 'We want to become the leading company in this industry by producing the highest-quality products with the best service at the lowest prices' sounds good, but it is full of generalities and contradictions. Such motherhood statements will not help the company make tough decisions.

• Rased on distinctive competences. Bang & Otufsen has the technology to build microcomputers, but an entry into that market would not take advantage of its core competences In style, hi-fi and exclusive distribution.

• Motivating. It should give people something to believe in. It should get a 'Yeah!', not a yawn or a 'Yuek!', A company's mission should not say 'making more sales or profits' - profits are only a reward for undertaking a useful activity. A company's employees need to feel that their work is significant and that it contributes to people's lives. Contrast the missions of the two computer giants IBM and Apple. When IBM sales were £50 billion, president John Akcrs said that IBM's goal was to become a $100 billion company by the end of the century. Meanwhile, Apple's long-term goal has been to put computer power into the hands of every person. Apple's mission is much more motivating than IBM's.

Visions guide the best missions. A vision is a contagious dream, a widely communicated statement or slogan that captures the needs of the time. Sony's

Eastman Kodak is one of many firms now asking: 'What business are we in?' It is one of many companies that diversified in the 1980s. Originally a photographic products company, it entered the attractive Pharmaceuticals and was on track for the much discussed 'information highway'. It offers the chance to take images from any source, manipulate them electronically, store them digitally (on PCs or CDs), transmit them, and display them on everything from photographic paper to TVs.

Kodak wanted to sell its pharmaceuticals and consumer healthcare divisions and reinvest the

Eastman Kodak Asks: ''What Business Are We In?'

Marketing

Highlight

consumer healthcare industry by acquisition and alliances. Then, in the late 1980s, tough competition and tight economic conditions saw its fortunes decline. Its debt burden went up and its imaging business lacked money for investment. Like IBM, the company was a troubled giant.

In early 1994 George Fisher, the company's new chair, launched a new plan that would take Kodak back to its imaging roots. George Eastman had started the company in 1880 and it had grown to be the world's biggest photographic company using silver-halide technology. This time the proposed technology was digital imaging - a business that was a small fraction of current sales and a loss maker. Silver-halide offered little opportunity for development, but digital imaging proceeds in its imaging business. The move would also lighten the group's $1 billion debt. Three divisions went up for sale: Stirling Winthrop (drugs and consumer health care), L & F products (personal care and household products), and the Clinical Diagnostics division. The sales raised §16.4 billion, almost a quarter of Kodak's 1993 revenue.

After the sale, Kodak was left with its imaging business and Health Sciences division. Health Sciences' X-ray film and electronic diagnostics businesses were central to Kodak's imaging strategy. Steps would be taken to protect and develop Kodak's traditional film products and especially its position in the rapidly developing market for digital electronic imaging, where its technology was the standard in multimedia applications.

Kodak is already coming tinder increasing pressure in the conventional silver-halide-based photographic markets. People in the developed world are buying more and better cameras, but not more films. Fuji is competing hard on price, and own-label films are undercutting Kodak's prices by 40 per cent. Unlike many market leaders, Kodak has joined the price cutters and launched Funtimc, priced 20 per cent lower than Kodak Gold. New markets in the East are growing fast, but these are very price sensitive and bootlegging abounds.

The move into digital imaging is a gamble. So far Kodak has little to show for the millions of dollars it has invested in digital-imaging technology. Its Photo-CD system, which uses CDs to store images, was a flop in the consumer market. Only a few hundred were sold in 1993. Kodak's digital camera also has problems: the black-and-white model costs over $8,000 and produces poorer pictures than a 35 mm camera.

Joint ventures make Kodak's prospects look better. A new digital camera from Apple Computer, using Kodak technology, may be on the market soon. It will cost a tenth of Kodak's product. Microsoft and Silicon Graphics are already using Kodak's digital-imaging technology. Fisher says he is talking to several potential part ners about longer-term ventures: 'We have to work with companies that are much stronger in software and teleeoms than we are.' With these ventures, the digital-imaging group expects to move into profit in two to three years. Will it? The 'electronic highways' to carry the digital pictures of little Jimmy do not exist yet. Also, there is still a price and quality gulf between silver-halide and digital imaging. The gap will eventually narrow, but expect it to close only slowly. Whenever a new technology takes on an old one, competition usually finds ways of squeezing unexpected performance out of the old dog.

Kodak missed out on video technology by concentrating on conventional films. It dominated the 16 rnm-video film market that almost disappeared overnight when video cameras arrived. Its effort in digital imaging recognizes that its business is imaging, not silver-balide film.

SOURCKS: Patnek Ilarveson, "Eastman Kodak prepare tor a new ima^e', Financial Times (4 May 1993), p. 29; Patrick Ilarveson. 'Kodak to return to core with drug sale', Financial Times (4 May 1994), p. 23; Chris Butler and Tony Patey, 'Drug firms on the trail of US partners', The European (6-12 May 1994), p. 15, 'Picture imperfect', Tim Economist (28 May 1994), pp. 87-8.

president, Akio Morita, wanted everyone to have access to 'personal portable sound', and his company created the Walkman. Richard Branson thought 'flying should be fun', so he founded Virgin Airlines. Thomas Monaghan wanted to deliver hot pizza to any home within 30 minutes, and he created Domino's Pizza.

The company's mission statement should provide a vision and direction for the company for the next 10—20 years. They do not change every few years in response to each new turn in the environment. Still, a company must redefine its mission if that mission has lost credibility or no longer defines an optimal course for the company." Marketing Highlight 3.1 describes how recent events have caused Eastman Kodak to think carefully about its mission. The hostile environment in the early 1990s caused Siemens, the German electronic giant, to review its strategy. Its seven core statements (Figure 3.2) provided strong communications and drove its strategy, structure and style of management.

100 Photography Tips

100 Photography Tips

To begin with your career in photography at the right path, you need to gather more information about it first. Gathering information would provide you guidance on the right steps that you need to take. Researching can be done through the internet, talking to professional photographers, as well as reading some books about the subject. Get all the tips from the pros within this photography ebook.

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