After reading this chapter, students should:
❑ Know how marketing affects customer value
❑ Know how strategic planning is carried out at different levels of the organization
❑ Know what a marketing plan includes
The value delivery process (marketing) involves choosing (or identifying), providing (or delivering), and communicating superior value to the consumer. The value chain is a tool for identifying key activities that creates value and costs in a specific business.
Strong companies develop superior capabilities in managing core business processes by managing core processes effectively to create a marketing network from suppliers to consumers. Managing these core processes effectively, means creating a marketing network in which the company works closely with all parties in the production and distribution chain, from suppliers of raw materials to retail distributors. Companies no longer compete— marketing networks do.
Holistic marketing maximizes value exploration by understanding the relationships between the customer’s cognitive space, the company’s competence space, and the collaborator’s resource space. It maximizes value creation by identifying new customer benefits from the customer’s cognitive space; utilizing core competencies from its business domain, selecting and managing business partners from its collaborative networks. Maximized value is delivered by becoming proficient at customer relationship management, internal resource management, and business partnership management.
Market-orientated strategic planning is the managerial process of developing and maintaining a viable fit between the organization’s objectives, skills, and resources and its changing market opportunities. The aim of strategic planning is to shape the company’s businesses and products so that it yields target profits and growth. Strategic planning takes place at four levels: corporate, division, business unit, and product.
The corporate strategy establishes the framework within which the divisions and business units prepare their strategic plans. Setting a corporate strategy entails four activities: defining the corporate mission, establishing strategic business units (SBUs), assigning resources to each SBU based on its market attractiveness and business strength, and planning new business and downsizing older businesses.
Strategic planning for individual businesses entrails the following activities: defining the business mission, analyzing external opportunities and threats, analyzing internal strengths and weaknesses, formulating goals, formulating strategy, formulating supporting programs, implementing the programs, gathering feedback, and exercising control.
Each product level within a business unit must develop a marketing plan for achieving its goals. The marketing plan is one of the most important outputs of the marketing process.
One of the most challenging concepts of this chapter, to most students, is the definition of strategy. In the case of the definition of strategy, it will be beneficial for long-term understanding and retention to cover what the definition is and what it is not.
The second area of concern presented in this chapter, is the understanding of strategic versus tactical. Definitions can be confusing and are often taken for granted, so the instructor is encouraged to spend sufficient class time covering the distinctions between these two.
Finally, this chapter contains a case analysis using Marketing Plan Pro software that may present some difficulties to students unfamiliar with its use. It is important to note that the objective of the inclusion of this software is to familiarize students with the many aspects of the marketing plan—not for them to become experts in the use of this specific software. The instructor may want to emphasize it usage at his or her discretion.
TEACHING STRATEGY AND...
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