Chapter 4 Strategic and Operational Planning LussierKimball Sport

Chapter 4 Strategic and Operational Planning Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning PPT 4 -1

XFL A great idea does not guarantee success. In fact, for every ten products introduced, eight fail. The reason for this high rate of failure? Poor planning. A prime example is the now-defunct XFL, which was the World Wrestling Federation’s attempt at developing a new professional football league. Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 2

Strategic vs. Operational Planning In strategic planning, management develops a mission and long-term objectives and determines in advance how they will be accomplished. In operational planning, management sets short-term objectives and determines in advance how they will be accomplished. Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 3

The Strategic Process Develop mission Analyze environment Set objectives Develop strategies Implement and control strategies Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 4

Three Levels of Strategies Corporate Business Functional Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 5

Situation Analysis Draws out those features in a company’s environment that most directly frame its strategic window of options and opportunities. Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 6

Situation Analysis: Three Parts Analysis of the company’s industry and its competition Analysis of the company’s particular situation Analysis of the company’s competitive advantage (or lack thereof) Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 7

Five Competitive Forces Rivalry among competing firms Potential development of substitute products and services Potential entry of new competitors Bargaining power of suppliers Bargaining power of consumers Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 8

Company Analysis: Five Steps Step 1: Assess present strategy Step 2: Analyze SWOTs Step 3: Assess competitive strength Step 4: Make conclusions Step 5: Decide what issues to address Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 9

Competitive Advantage Specifies how the organization offers unique customer value. What makes us different from our competition? Why should a person buy our product or service over the competition’s? Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 10

Goals and Objectives Goals state general targets to be accomplished. Objectives state what is to be accomplished in specific and measurable terms by a certain target date. Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 11

Management by Objectives MBO is the process by which managers and their teams jointly set objectives, periodically evaluate performance, and reward according to the results. Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 12

Grand Strategies Growth Stability Turnaround and Retrenchment Or a combination thereof Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 13

Corporate Growth Strategies Concentration Backward integration Forward integration Related and unrelated diversification Mergers Acquisitions Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 14

Business Portfolio Analysis Corporations determine which lines of business they will be in and how they will allocate resources among the different lines. A business line—also called a strategic business unit (SBU)—is a distinct business with its own customers that is managed reasonably and Lussier/Kimball, Sport Management, First Edition independently of athe other 15 Copyright © 2004, by South-Western, divisioncorporation’s of Thomson Learning

BCG Growth-Share Matrix Cash cows Question marks Stars Dogs Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 16

Business-Level Strategy Adaptive Strategies: prospecting, defending, and analyzing. Competitive Strategies: Michael Porter identifies three effective business-level : differentiation, cost leadership, and focus. Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 17

Product Life Cycle Introduction Growth Maturity Decline Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 18

Functional-Level Strategies Operational strategies are used by every functional-level department—marketing, operations, human resources, finance—to achieve corporate- and business-level objectives. Lussier/Kimball, Sport Management, First Edition Copyright © 2004, by South-Western, a division of Thomson Learning 19