Strategic Objectives & Analysis - Step 1/4 Str. Mgt. Process/Framework - II

 

Strategic Objectives & Analysis

This has two distinctively different parts that integrate themselves to the design of strategies for next time slot. The Internal & External analysis form the one part and Review of Vision & Mission form the next part. 

Even if your organization already has well-defined mission, vision, and values statements, you should review them throughout the strategic planning process

Having understood what is meant by Vision, Mission, Goals and Objectives, the next logical step is to analyse them for strategy formulation with respect to any given company. The tools used in this respect are SWOT, PEST/PESTL analysis. These will provide the map of businesses the firm is involved and bring to light what opportunities/constraints  may unfold in future.

I. Internal & External Analysis

An external analysis looks at the wider business environment that affects the business. An internal analysis looks at factors within the business such as its strengths and weaknesses.

Understanding the environment the business operates in is a key part of planning, and will allow one to discern the threats and opportunities associated with the area of business.

An external analysis looks at the wider business environment that affects the business.

An internal analysis looks at factors within the business such as its strengths and weaknesses. A common way to begin is to review the organization's current state and future possibilities using a SWOT (strength, weakness, opportunity, and threat) analysis. This involves identifying strengths and core capabilities in products, resources, people, and customers. These are what the organization is best at, and why it is in business. Many organizations have responded to this review by spinning off ventures that were not related to their core business. For example, Chrysler sold its interests in Maserati, Lambourghini, and Diamond Star and then concentrated on developing "great cars, great trucks." This sent a clear message to employees and other stakeholders, and triggered the company's renaissance.

Examining the internal and external analyses together gives one a complete picture of the current situation and the steps one can take to plan 

a. Internal Analysis

SWOT  

One also need to understand the internal strengths and weaknesses of the business. 

A SWOT analysis combines external and internal analysis to summarise its Strengths, Weaknesses, Opportunities and Threats. For example, a new business may note the following:

• Strength: enthusiastic employees or a unique product
• Weakness: no existing customer base and limited finances
• Opportunity: potential customers with problem the product solves, interested investors
• Threat: competition from established businesses with a bigger budget

One need to look for opportunities that play to strengths of the business. One also need to decide what to do about threats to the business and how one can overcome important weaknesses.

For example, your SWOT analysis might help to identify the most promising customers to target. One might decide to look at ways of using the internet to reach customers. And one might start to investigate ways of raising additional investment to overcome the financial weakness of the business.

b. External analysis

PEST/PESTLE 

A PESTLE analysis helps you to identify the main external opportunities and threats in your market:

• Political changes such as trade agreements between countries 
• Economic factors such as interest rates, exchange rates and consumer confidence
• Social factors such as changing attitudes and lifestyles, and the ageing population
• Technological factors such as new materials and growing use of the internet
• Environmental factors such as environmental law and impact on the environment
• Legal factors such as new and existing legislation 

 

Once these tools like SWOT , PEST/PESTL analysis, the next logical step is to look at the existing Vision and Mission statements of the firm and make them reflect companies businesses, brands and ideologies.

II. Analysis of Vision & Mission

 

Vision: The imagined/desired future for the organization, that is developed through free-form discussion, imagining, visualization, and is not constrained by any specific areas (could include customer perceptions, productivity, internal stuff, etc.).

Mission: a short statement of purpose/intent, and a general statement of how those are achieved (services, products, etc.), and including values that have emerged in the vision. Mission usually a more here and now statement, but not restricted to the present.

Goals: more specific outcomes (eg. increase market share by x% by..).

Objectives: goals broken down into more doable components, to ultimately be parcelled out.

The questions to be answered for deriving vision statement:

1. What is our imagined future?
2. Given our imagined future and the values inherent in it, what is our mission (aimed at achieving our common vision)?
3. Given our mission, what do we need to achieve that falls within our mission and brings us closer to our vision.
4. Given our goals, what objectives must we have to bring the goals to fruition?

 

Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.

—Jack Welch, former CEO of General Electric

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