Strategic Planning

Introduction

• Lecture Source: Open Tuition.
• Important: Download free lecture notes from openuition.com.

Definition of Strategic Planning

• Meaning: Long-term planning (5-10 years).
• Contrast: Different from next year's budget.

Company Case Studies

IBM

• Era: 1980s
• Status: Was one of the largest companies, second to large oil companies.
• Issue: Failed to adapt to the rise of personal computers.
• Outcome: Shifted from making large computers to services.
• Current Strategy: Supplies computing services; sold personal computer business to Lenovo.

Nokia

• Era: ~10 years ago
• Status: Most popular phone brand.
• Issue: Stuck with an old operating system, didn't adapt to smartphones.
• Outcome: Brand nearly disappeared; struggling to survive.

Kodak

• Historical Focus: 35mm film cameras.
• Issue: Digital cameras overtook the market more quickly than anticipated.
• Outcome: Could not compete with established digital camera brands; now experimenting with cryptocurrency.

Uber

• Nature of Business: Facilitated cheaper taxi services via technology.
• Issues:
  • Cultural problems within the company.
  • Fair treatment of drivers questioned.
  • Safety and vetting concerns.
  • Traditional taxis lobbying against Uber.

Lessons from Failures

• Common Causes:
  • Technological advances not adapted to.
  • Changes in consumer taste.
  • Reputation issues.
  • Economic changes affecting luxury goods.
• Key Insight: Even well-regulated companies can fail, but strategic planning can improve longevity chances.

Conclusion

• Strategic Planning: No guarantees, but essential for sustainability.