Develop a Strategic Business Plan for a New Venture

Develop a Strategic Business Plan for a New Venture

You are expected to discuss a number of components that appear in the ‘Strategic
Management Process’ in relation to an innovative idea/ new venture. However, in the
same way that businesses vary in the processes they use to formulate and direct their
strategic management activities, you may include different components in your
strategic process. In other words, although the basic components of the models used
to analyze strategic management operations are very similar, you may develop an
eclectic strategic analysis. Despite the differences, nevertheless, your strategic
analysis should be representative of the foremost thought in the strategic management
area. Your strategic management process may include all, or most of the following
key components (source: Pearce and Robinson, 2010):
Company Mission
Form a company mission for your new venture. The mission of a company is the
unique purpose that sets it apart from other companies of its type and identifies the
scope of its operations. In short, the company mission describes the company’s
product, market, and technological areas of emphasis in a way that reflects the values
and priorities of the strategic decision makers.
Internal Analysis
The company analyzes the quantity and quality of the company’s financial, human,
and physical resources. It also assesses the strengths and weaknesses of the
company’s management and organizational structure. You are expected to proceed to a
similar analysis, using appropriate tools such as SWOT analysis.
External Environment
A firm’s external environment consists of all the conditions and forces that affect its
strategic options and define its competitive situation. The strategic management
model shows the external environment as three interactive segments: the remote,
industry, and operating environments. You should present and discuss a similar
analysis about the external environment of their new venture.
Strategic Analysis and Choice
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Simultaneous assessment of the external environment and the company profile
enables a firm to identify a range of possibly attractive opportunities. These
opportunities are possible avenues for investment. However, you must be screened
through the criterion of the company mission to generate a set of possible and desired
opportunities. This screening process results in the selection of options from which a
strategic choice is made. The process is meant to provide the combination of longterm
objectives and generic and grand strategies that optimally position the firm in its
external environment to achieve the company mission.
Long-Term Objectives
In your analysis, you are expected to emphasize the importance of long-term
objectives. The results that an organization seeks over a multiyear period are its longterm
objectives. Such objectives typically involve some or all of the following areas:
profitability, return on investment, competitive position, technological leadership,
productivity, employee relations, public responsibility, and employee management.
Generic and Grand Strategies
Many businesses explicitly and all implicitly adopt one or more generic strategies
characterizing their competitive orientation in the marketplace. Low cost,
differentiation, or focus strategies define the three fundamental options. Although
every grand strategy is a unique package of long-term strategies, 15 basic approaches
can be identified. You are expected to present and discuss the generic and grand
strategy/ies that are suitable for their new venture, how are to be achieved, and their
roles towards achieving the organization’s long-term objectives.
Short-term objectives
Short-term objectives are the desired results that a company seeks over a period of one
year or less. They are logically consistent with the firm’s long-term objectives.
Companies typically have many short-term objectives to provide guidance for their
functional and operational activities. Thus there are, among others, short-term
marketing activity, raw material usage, employee turnover, and sales objectives. You
should discuss their short-term objectives, and their role in supporting generic and
grand strategies.
Functional tactics
You are expected to suggest a number of functional tactics and how these short-term
activities are used to achieve short-term objectives and establish competitive
advantage. Within the general framework created by the business’s generic and grand
strategies, each business function needs to undertake activities that help build a
sustainable competitive advantage. These short term, limited scope plans are called
tactics. A radio ad campaign, an inventory reduction, and an introductory loan rate ar
examples of tactics. Functional tactics are detailed statements of the ‘means’ or
activities that will be used to achieve short-term objectives.
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Policies that empower action
Speed is a critical necessity for success is today’s competitive, global marketplace.
One way to enhance speed and responsiveness is to force/allow decisions to be made
whenever possible at the lower level in organizations. Policies are broad, precedentsetting
decisions that guide or substitute for repetitive or time-sensitive managerial
decision-making. Creating policies that guide and ‘preauthorize’ the thinking,
decisions and actions of operating managers and their subordinates in implementing
the business’s strategy is essential for establishing and controlling the ongoing
operating process of the firm in a manner consistent with the firm’s strategic
objectiv

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