Strategic planning in European multinationals

Recent environmental changes have brought about modifications in the strategic planning practices of multinational businesses. These modifications in the strategic planning practices were studied through the medium of in-depth interviews with planners in a number of concerns. Of the several changes observed, predominant are the shortening of time horizons and the increase in flexibility. Equally noteworthy is the surprising lack of change in the social concern of a number of the organizations. This article summarizes a study of the effects of environmental changes on multinational-business planning.     

Strategic planning in government-dependent businesses

As the role of government has expanded in various countries, standard distinctions between the public and private sectors have become blurred. This paper explores the special context within which strategic planning must take place in organizations with a very high dependence on government. Four types of government dependency are considered: ownership dependency (public enterprises); regulation dependency (private, regulated firms); input-dependency (e.g. non-profits dependent on state funding); and output-dependency (e.g. defence contractors who sell a considerable portion of their output to governments).Despite their seeming differences, all four types of government-dependent organizations (GDOs) experience five distinctive problems that seriously limit the relevance of traditional planning models (or what are often referred to as ‘rational, comprehensive models’). They are: fragmented strategic decision-making authority; heightened goal ambiguity; politicization of strategic decision-making; short-term orientation and internal bureaucratization.The concepts of strategy and strategic planning are as relevant to Government dependent organizations (GDOs) as they are to other kinds of firms, although the planning system has to be designed somewhat differently. Six tentative guidelines for designing the planning system in GDOs are presented in the paper: (1) plans must be ‘negotiated’ rather than ‘formulated’ in GDOs; (2) outsiders must be involved in the planning process; (3) socio-political issues must be integrated with technoeconomic tissues; (4) top management must play an active role in running the system, especially in managing interfaces with government; (5) the planning system should emphasize flexibility over discipline or rigor and (6) plans must be written up with the expectation that much of their contents could become public knowledge.The paper concludes with the view the GDOs may have a lot to learn from one another despite superficial differences in institutional status (public vs private) and nature of goals (for- profit vs not-for-profits).     

Strategic planning for MIS

This article report on a study of the strategic decision to develop computerized management information systems (MIS) in 32 business organizations. THe findings suggest that this decision is a complex policy decision which involves protracted environmental negotiations, a high and escalating commitment of organizational resources, and extensive organizational preparation. Eleven organizational and environmental factors which influence the decision are identified through a literature review. The influence of these factors on the success of the decision is examined and recommendations are made for managing the decision-making process to insure improved decision outcomes.     

Strategic planning and inflation

The author of this article argues that inflation is a neglected area in corporate planning despite the events of 1974/1975. The planning problem which companies face because of inflation is defined, while acknowledging that it is difficult to solve. Recent experience has shown that inflation has a direct impact on every major area of business. Thus it is essential that there is a meaningful attempt to handle these problems in planning. The author discusses his approach to grasping this nettle.     

Strategic planning for distribution

The process of long range planning is relatively new to both the corporation and the distribution area. Until recent years the distribution function was considered a functional area which reacted to, rather than anticipated, corporate marketing effort. New technology in data processing and other areas has provided the support capability for developing both tactical and strategic planning. With this increased capability has come a new responsibility for distribution management to be future oriented—to anticipate the appropriate support role of physical distribution in supporting both short term and long term corporate goals.     

Strategic planning for resources

In the field or purchasing and supply, 1973 was a year to be remembered. A world-wide boom in industrialised countries produced record prices in markets for food, raw materials and manufactured goods. Rates of inflation in the U.S.A., Western Europe and Japan began to approach South American levels. The value of the dollar, the pound and other major currencies fluctuated dramatically, and the stock market experienced falls comparable to those which occurred during the slump in the thirties. Finally, 1973 was the year of the oil embargo, when oil prices were almost doubled and oil supplies to the West were cut by 15–20%, resulting in the rationing of oil and other commodities in Western Europe.By any standards, this was a momentous year. It is conceivable that supply markets will never be quite the same again. The traditional form of multi-national business, integrated from supply to consumer markets, is fast disappearing as the companies formed in developing countries to secure the supply of oil, food and raw materials are being taken over by the host governments. Indeed it may be that after the traumatic experiences of this year, negotiations for food and key raw materials will be increasingly carried out by governments rather than by private companies.To cope with shortages and higher prices in food, fuels and essential raw materials, government bodies and public and private enterprises will have to develop new capabilities. Western governments have responded quickly by setting up Ministers and Ministries for Energy and by establishing huge budgets for research into the exploration and exploitation of alternative fuels. The large oil companies have declared that they are in the “energy business” and have bought interests in nuclear power and coal.But what does the energy and resource crisis mean for the average firm? It seems that in the 1970s we are experiencing a level of competition for supplies similar to the competition for consumer markets which first produced “Marketing” in the late fifties and early sixties.     

Strategic planning for endgame

This article is based on the author's study of 61 firms managing businesses in environments of declining demand. It suggests ways in which firms might better prepare for this problem by managing their own exit barriers and by making strategic investments to affect the level of their competitors' exit barriers.     

Strategic planning for the board

Although the planning operation is regarded by some observers as unrealistic in conditions of rapid change and increasing competition, the discipline of strategic thinking and the need for strategic leadership continue to be of vital importance. The author examines the purpose of the Board of Directors and its role in the management of strategy.     

Strategic planning for public relations

Public relations is a key activity for most chairmen of public companies and nationalized industries. It is somewhat suprising therefore how few large companies consider developing an explicit public relations strategy as part of their overall business plan. The reason for this may be partly due to the relatively low regard which senior line managers have for public relations managers and partly because there is a lack of understanding of the nature and use of public relations as a tool of strategic management. The purpose of this article is to discuss why and how business planners should pay more attention to developing explicit public relations strategies for their organizations.     

Strategic planning for international business

Although international business is old, today's problems deserve careful thought: the methods by which international strategic plans are made are capable of improvement in many companies. Further, much of today's international business has to face up to being multi-national, rather than international, which means that it exists in an environment which in many ways is not in step with its aims. The legal, political, social and economic climates bring many problems to the group which is endeavouring to be multi-national, problems which will be discussed later in this paper.     

Strategic planning in smaller rapid growth companies

The research reported in this article is based on a study of the strategic planning practices of the 500 fastest growing privately held smaller companies in the United States ranked according to percentage of sales increases from 1978 to 1982.^p1 Based on the information provided, a clear picture emerges regarding the actual role of strategic planning in rapid growth companies.     

Strategic planning in the Thomas Cook group

Until Midland Bank took control of Thomas Cook in 1972 there were only rudimentary accounts in the Group and no systematic attempt to budget its operations. An immediate priority was to establish an effective finance function and the first planning activities of the Group were centred in this area. At the beginning of the annual planning cycle a Group Strategic Conference at Board level and a Group Planning Conference determine strategies and many territories follow this latter meeting with their own regional conference to discuss Plans, which are finalized and consolidated by computer into the Group Plan, to be ready for the start of the financial year.     

Strategic planning in a changing corporate environment

Strategic planning is about nothing, if it is not about attempting to achieve desirable futures. In the past this has often been seen as an excuse, or indeed a necessity, for fixed goals which are constantly timed. Such a state of planning has, fortunately, for a long time now been discredited and this paper concentrates upon the concepts of strategic planning within the changing corporate environment, an environment which therefore has to effect both the goals as well as the process of planning. Furthermore, the author concentrates upon the concept of a planning, allocating, and monitoring cycle of strategic planning which sets the strategic planning concept within a process cycle as well as within an effective allocative structure. The author considers this latter point an extremely important one since, as he says, ‘planning can become a very sterile and barren activity if it is not viewed integrally with acting and doing’. Finally, this paper concentrates on the important fact that planning must, within a dynamic environment, be an iterative and a learning process.     

Strategic planning in an age of uncertainty

Strategic planning and decision making in the face of uncertainty have always presented a serious challenge to top management, but the present scale of uncertainty is unprecedented. Decision makers used to be able to rely on the past to predict the trends of the future. Now they are increasingly being forced to make important decisions that depend upon highly uncertain external factors for which the past offers little guidance. In all areas of business and government, there is a vital need to understand and implement procedures that enable decision makers to deal more effectively with uncertainty for planning and allocating their organizations' resources.Because of differences in their social, political and economic environments, European and Japanese managers are today affected by many acute areas of uncertainty— such as industrial democracy, floating exchange rates, changing social and political values, growing environmental awareness, government regulation, technological change, pollution control regulation, energy cost, and raw material availability—earlier than their counterparts in the U.S.A. These uncertainties affect not only private sector manufacturing industries, but also financial and service industries as well as nationalized industries and government organizations.This article shows how ineffective methods of dealing with uncertainty can lead to serious mistakes with costly consequences. The cost of overconfidence and people's natural but futile tendency to ignore or to try to eliminate uncertainty is illustrated by the crises seen recently in the world steel and shipbuilding industries. The article then demonstrates how decision analysis procedures that focus directly on the major decision points in the strategic plan enable executives not only to include uncertainty directly in their strategic planning, but also to increase their understanding of the decision process and their ability to communicate the results to others.     

Strategic planning in a turbulent international environment

What we have argued in this paper is that fundamental changes in the multinational corporate environment are taking place raising proaches to multinational environmental surveillance and multinational strategic management. We arenot offering this as a forecast of what the future will bring. Instead, we are proposing this framework to point to the need for greater environmental orientation and adaptation. MNCs are now in a double squeeze and managers must unlearn past models and criteria to understand problem. But the challenge is more than conventional corporate planning. The problematique can be decribed as one of multinational strategic management. In the area of environment we need research and learning to address three basic questions:What is the MCE? What concepts of the environment should be considered for strategic management? What parameters should be monitored? What are some consequences of the concept of interdependence and turbulence?What multinational environmental surveillance should be done? What methodologies are needed? How can these be made operational? How can the corporation be educated to behave in the new mode required in view of these changes?What new strategic issues and challenges lenges emerges from the MCE? What new demands must be factored into the multinational corporate planning processes? What new content does the changing environment procedure? How can the broadening field of opportunities and threats be systematically mapped and understood?     

Strategic planning in small and medium-sized companies

In analysing the characteristics of strategic planning applications in different types and sizes of companies, confusion often arises not because of the application but because of the definitions utilized. This paper analyses the use of strategic planning concepts in small and medium-sized companies in Holland. As the author points out, in this context the definition of small and medium-sized is determined by five strategically relevant criteria which are distinctive. The author points out, however, that whilst these criteria are distinctive of the category of small and medium-sized companies surveyed, they do not all have to occur at the same time; the higher the number that do occur, the more typical the company. Whilst this paper does not, as the author admits, represent the result of a systematic survey, the authors wide experience as a consultant is in itself a valuable background to his analysis. Indeed, the findings stated in this paper represent an analysis of the strategic planning practises of some 75–100 companies. Therefore, in view of the detailed criteria utilized and the number of companies analysed the results represent an important addition to our knowledge of the application of strategic planning.     

Strategic planning: One workable approach

This article outlines one method or model that over 130 companies around the world are using successfully. Not all planning efforts are successful, and obviously there is more than one successful technique or system of corporate planning in use. It has been adopted by national and international corporations, and by at least one religious order.     

Strategic planning for research and development

This paper examines the need for and the difficulties in implementing strategies for planning the research and development activities of a company. The author does not accept that research planning reduces creativity, though he is of the view that planning's exclusive concentration on economic aspects of a company's activities, such as turnover or profit, can lead to erroneous decisions in the research and development field. This paper outlines a number of specific and explicit research strategies which can be followed, and relates them to the company's strategic objectives. Furthermore, the author explicitly categorizes different types of research and comments upon the relevance of strategic planning to each.     

Strategic planning for the armed forces

The author points out that in most countries the defence department is a very large ‘business’. He claims that, although long-range planning in the Canadian Department of National Defence may not be perfect, it does follow the stages of traditional strategic planning. He describes these stages, pointing out some innovations which he feels could be of value to other government departments in other countries as well as to large corporations in the private sector. He emphasizes the importance of feedback and describes ‘capability components’ which have been developed in the Canadian defence department to replace the traditional thinking in terms of ‘Army, Navy, Air Force’. Each capability component focuses on the required output/result and has a sponsor who is responsible for developing plans for the long-term ‘state of health’ of his capability component. Overall, the author makes a strong case for forward-looking and results-oriented strategic planning.     

Strategic planning system for multinational companies

This article is based on a research study, the object of which is to illustrate the major components of global planning in the context of modern administration. Data were collected from a representative sample of multinational companies, both U.S. and non-U.S. based. The planning process in the companies surveyed followed a pattern based on formal planning systems. The author concludes that multinational corporate planning will in future become a blend of administrative and institutional types of plans.