In large retail firms, plans are developed at different organizational levels, including corporate. divisions. functional units. and departments. Managers at each level are responsible for developing and executing specific types of plans, all directed towards accomplishing the same mission.
Corporate- Level Plans
The chief executive officer (CEO) and other top-ranking executives at the highest corporate level plan strategically. Corporate executives assess the position of their retail organization and develop long-term goals and strategies. Strategic planning involves a process that begins with a description of i the type of business and mission, which includes market segments served; : its image; and statements of commitment to excellence in areas of customer . relations, merchandising, marketing, and service. The mission serves as the foundation for all planning in the organization. Strategic planning requires an assessment of the economic environment and an analysis of the retailer's strengths, weaknesses, opportunities, and threats (SWOT). From this analysis, strategic plans related to marketing and financial objectives are formulated around profit, position, products, brands, size, stores, and customer base.
In retail environments, divisions are composed of different functional units separate from each other. At this level, planning is required to integrate, coordinate, and align the functional groups' diverse activities with the corporate mission. Depending on the size of the company, individuals at this level are responsible for formulating both long-term strategic plans and short-term operational plans related to functional units in their divisions. Divisional plans include tactics directed towards defining, in concrete terms, how the functional operating units will accomplish corporate goals
Managers in functional units develop short-range operating plans that outline what is required to achieve long-range objectives. Each functional unit develops its own subset of specific strategies and plans consistent with the overall mission. At this level the emphasis is on planning for relatively short periods of time, ranging from six months to a year. Functional plans are related to specific product categories or classifications and are quantifiable, enabling planning results to be controlled and measured.
Department plans deal with specific details required to support functional unit plans. Tactical efforts at this level must be coordinated with other departments within the organization. Typically, planning at this level involves supervision, service, and motivation of the sales force.
Merchandising is defined as the planning, development, and presentation of products to a target group. Inherent in this definition are specific functions associated with budgeting, inventory, assortment, sales, product development, sourcing, presentation, and promotion-all of which involve coordinated planning. A merchandise division is organized in a hierarchical structure with managerial support to direct planning for these functions.
At the top level of the merchandise division is a general merchandise manager (GMM) who is responsible for supervising all activity related to buying and selling merchandise. The second level is composed of division merchandise managers (DMMs) who report to the general merchandise manager. Divisional managers are responsible for monitoring sales and inventories of functional departments identified by product lines.
Other members of the merchandise division include:
buyers, planners, allocators, product developers, merchandise managers, and department managers. The functional tasks associated with these members are organized differently among retailers. The one common feature is that the buying and selling tasks are separate relative to where they are performed....