Friday, November 13, 2009

Long Range Planning: Terminology

Long Range Planning: Terminology
Kotler describes the function of the mission statement, the start of the now traditional approaches to corporate planning, thus:

A well worked-out mission statement provides company personnel with a shared sense of opportunity, direction, significance and achievement.

The company mission statement acts as an ‘invisible hand’ that guides geographically scattered employees to work independently and yet collectively toward realizing the organization’s goals.

Goals he describes even more succinctly:
....indicates what the business unit wants to achieve in the planning period.

Goals and objectives often have the same meaning. Kotler stresses that as far as possible they should be quantitative and realistic.

Strategy is about how goals are to be achieved:
Goals tell where a business wants to go; strategy answers how it plans to get there. Every business must tailor a strategy for achieving its goals. The strategy must then be refined into specific programs that are implemented efficiently and corrected if they are failing to achieve the objectives.

This quotation for Kotler also illustrates what is involved in the implementation of programs or tactics, which in turn lead to short term plans with a number of targets being set.

These terms can helpfully be thought of reference to a single factor: time.

The mission is the description of the main, permanent values which ultimately motivate the organization.

Goals or objectives specify where the organization wants to be in the future.

Strategy is the broad course of action planned to enable the organization to achieve its goals. Tactics are the specific programs of activities needed to implement the strategy in the shorter term (typically within the annual budgetary cycle).
Long Range Planning: Terminology
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