Planning constitutes the first stage of the organization's management process and an essential phase in the entire strategic projection mechanism. It is an essential instrument to guide the path of organizations and therefore it is unavoidable to have its tools when it comes to anticipating the future.
Wrong criteria in the initial years of socialist construction in Cuba contrasted the concepts of planning and the market, however, practice has shown that both elements are identified when the final purpose is common; Armando Pérez Betancourt, (2004) - Executive Secretary of the Government Group for Business Improvement of Cuba points out in this regard-… “Why not apply Marketing? What prevents us in Socialism from recognizing that the client is the one who decides, not the producer?".
Taking into account the importance of studying this topic and the lack of reference works in our country that address the issue of strategic market planning from this perspective, this article compiles a set of criteria on strategic planning and the role of companies. Business Units in the strategic planning of Marketing.
Documentary Analysis and Abstract Logic were used as fundamental research methods, with their analysis and synthesis and induction and deduction procedures.
1. Strategic Planning as a business management tool.
Organizations, as human groups, are constantly obliged to make decisions on the success of which will depend on their proper conduct, the decisions themselves are the product of a process of reflection that involves various activities, this systematic and orderly reflection being what is known as Planning.
The entire planning process, Stanton notes, (1984) consists of "studying the past to decide in the present, what to do in the future, how to do it, when to do it, and who will do it."
Planning is foreseeing and deciding today the actions that can take us from the present to a desirable future.
It is not about making predictions about the future, but about making the pertinent decisions so that that future occurs.
The conceptual bases of Strategic Planning did not appear until the beginning of the seventies, when a global crisis was triggered that manifests itself in the increase in oil prices; Raw materials and energy sources are scarce, as well as double-digit inflation, which produces the stagnation of the economy and the growth of unemployment, especially in the United States, since goods from other countries appear, mainly from Japan, from low cost and high quality, which displace almost all international markets. (De la Cuesta, 2006)
Equally to his say; "This generalized crisis required a new type of planning that would allow the development of the financial health of companies, regardless of the negative events that could occur in their environment."
Strategic planning consists of a process that is constantly fed back and that passes successively through three phases, points out Godet, (1990):
- Strategic phase, in which the mission and objectives of the center are determined through the identification of its strengths and weaknesses, through an internal diagnosis, as well as the opportunities derived from the changing environment that surrounds it. Operational phase, in which the programming of the actions and the coordination of the efforts to achieve the objectives are carried out. Budgetary phase, where the resources corresponding to the objectives under development, commitments and responsibilities, the analysis of the results and the control are assigned.
According to Drucker (1994) “Strategic Planning is a means of evaluating risk and trying to keep the organization optimally adapted, constantly analyzing changes in the environment and making the most of available internal resources, which confer an advantage against the competition, taking advantage of the opportunities in the most effective way ”.
"The strategic planning process is an organizational effort, defined and disciplined that seeks that the institutions define as clearly as possible their mission and the vision they have of it in the medium and long term, becoming a powerful tool that enables adaptation from the organization to demanding, changing and dynamic environments, achieving maximum efficiency, effectiveness and quality in the provision of their services ”. (Ministry of Transport, 1999)
Kotter, (1999) points out that "Market-oriented strategic planning is the process of developing and maintaining a viable fit between the objectives and resources of the company in such a way that they give satisfactory benefits and growth."
Ambrosio, (2000) also claims that: “Strategic planning is a management method that provides managers with a means by which to anticipate and deal with internal and external changes and therefore develop appropriate strategies for an uncertain future, of such a way that allows the organization to achieve its objectives and mission ”.
The issue of strategic planning occupies a more relevant place every day, managers progressively verify the advantages of the development of this process to lead the organization in a logical and comprehensive way both in the short, medium, and long term.
Medium and long-term strategic planning is the function that, developing at each level of responsibility, but with more ownership at the general management level, is intended to provide operations and the participation of the elements to achieve an objective..
The strategic planning process must be understood as a participatory process, which gives coherence, unity and integrity to the decisions of the organizations, allowing to act in dynamic and changing environments, taking the necessary measures to achieve the objectives that the institution has set. The definition of the objectives and their corresponding strategies will allow to select the priority activities for the improvement of the service or organization and take advantage of the advantages that appear related to their activity.
The ability of organizations and institutions to observe and anticipate the challenges and opportunities that are generated, is developed and sharpened through strategic planning, considering both the external conditions of the organization and its internal reality, which are sources of change dynamic and make the strategic planning process dynamic as well.
When planning strategically, it is not necessary to list detailed actions and programs in time and cost, but it is necessary to have the ability to determine an objective, linking the resources and actions necessary to achieve it and assessing the results and consequences of those decisions.. Based on this, strategic planning is defined as a process and an instrument. Process in that it raises different stages with a set of actions and tasks that involve the members of the organization in the search for clarity regarding the task and appropriate strategies for its improvement; instrument in that it constitutes a conceptual model that guides decision-making aimed at implementing the changes that are made necessary.
(Ministry of Transport, 2000)
Even when the strategic planning system allows to develop the vision of the organization and help in the achievement of the goals that it has proposed, it cannot be considered the solution to all the problems or concerns of the organization.
One of the instrumental functions of strategic planning is to balance three types of force:
- The mission of the organization. The opportunities and threats that the organization faces and that come from the external environment. The strengths and weaknesses of the internal environment of the organization.
Many studies have consistently shown that setting a vision, defining a mission, planning, and setting objectives positively influences the performance of an institution.
History and great leaders have taught us that an attractive vision of the future can have a very exhilarating effect on people. Some evidence has also been collected that organizations that have developed a strategic plan, be they large or small, perform better than those that have not.
(Ministry of Transport, 2000)
When planning strategically, it is possible to think ahead, recognize new opportunities and threats, direct the mission of the organization and effectively guide its course by promoting creative direction and leadership action.
Strategic planning constitutes a managerial system that shifts the emphasis from “what to achieve” (objectives) to “what to do” (strategies). Strategic planning seeks to focus on those feasible objectives to achieve and in which business or area to compete, in correspondence with the opportunities and threats offered by the environment. (Hiebaum, 2004)
1.1. Strategic Marketing Planning.
The deep contradictions that slow down the realization of merchandise, force the search for formulas to guarantee their sale and commercialization, one of those formulas is Marketing, which has gained popularity especially in current times, but it is really a conception that its appearance has been related to the historical development of commerce for many years.
If the arrival of Marketing means something, it is precisely the transition of commerce: from that predominance of interests of the seller, to the consideration of the buyer or consumer.
According to Santesmases, (1991) "Marketing is the human activity that aims to satisfy needs and desires through exchange processes, it is, therefore, both a philosophy and a technique."
“As a philosophy, - continues Santesmases, (1991) - it is a mental posture, an attitude, a way of conceiving the exchange relationship by the company or entity that offers its products to the market. This conception is based on the needs and desires of the consumer and aims to satisfy them in the most beneficial way, both for the consumer and for the entity ”. "As a technique, marketing is the specific way of executing or carrying out the exchange relationship, which consists of identifying, creating, developing and serving the demand."
Marketing plays a critical role in the Strategic Planning Process of companies… the Marketing Director is the one who must contribute most to the strategic planning process with leadership roles, in defining the company's mission; analysis of the environment, competition and business situations; development of objectives, programs and strategies; definition of the product, market, distribution and quality plans to develop business strategies. This commitment extends to the development of programs and operational plans that are fully linked with strategic planning. (Kotler, 1999)
One of the most useful and important characteristics of Marketing consists of being able to plan the future of our company with a sufficient guarantee of success, basing ourselves on the responses we offer to market demands, the environment in which we operate is constantly changing and evolving, The success of our company will depend, to a large extent, on our ability to adapt and anticipate these changes. We must be able to understand to what extent and in what way the future changes that our environment will experience will affect the company and establish the most appropriate strategies to make the most of them for our benefit.
For this, the company must establish its objectives based on the formulation of what the company itself is, what is its market-product and who are its customers. The company must never turn its back on the market. (Muñiz, 2001)
The definition of the company itself and the business it is in, the product it sells or the service it provides, the market it is aimed at; It is the starting point of strategic Marketing.
Strategic Marketing helps us so that the company can take advantage of all the opportunities offered by the environment, overcoming its threats, facing the constant challenges that are presented to it. (Muñiz, 2001)
The company must make decisions in the present, but taking into account how its future could be affected by the incidence of our actions, observing the changes that arise in the environment and making the most of the internal resources available and that constitute a key competitive advantage, with respect to the competition.
Strategic Marketing is essential so that the company can not only survive, but also have a prominent position in the future. Muñiz affirms… “Responding successfully to the question - do we have a strategy for the future? - seems to be difficult since regardless of the fact that not all companies raise it, they have the disadvantage of putting it into practice. Therefore, one of the main concerns of corporate strategists is to find the fastest and safest way to create value, understood not only as a result that benefits the shareholders of the company, but as something capable of satisfying or retaining customer loyalty. clients, employees and suppliers ”.
The Strategic Planning of Marketing according to Muñiz, (2005); Its purpose is to produce profound changes in the organization's markets and internal culture.
The activities of Strategic Marketing Planning are:
- Define the Mission. Identify the Strategic Business Units. Analyze and value the business portfolio. Identify new business areas.
2. The Strategic Business Units in the Strategic Marketing Planning process
The Company is in need of analyzing, designing and implementing the business strategy at different levels: Corporate, Business and Functional.
The Strategic Business Units fulfill their main role precisely at the intermediate level for which business strategies or competitive strategies are developed.
The concept of Strategic Business Unit emerged in the seventies when the General Electric Company, given its diversification - ten groups with a total of fifty divisions and one hundred and seventy departments; Constituted as profit centers, it defines units of analysis different from those existing up to that moment, thus facilitating the strategic planning process in such a complex organization.
For Springer, (1973) a Strategic Business Unit is a “business or group of related businesses that has its own distinctive mission, its own competitors, its own markets and so on, so that the responsibility for the total business, short and long term, can be realistically focused on one manager. This manager is responsible for the strategy of his Strategic Business Unit, but his plan is in tune with the purpose of allocating resources, with the global interests of the company ”.
This conception of the Strategic Business Units as a unit for the analysis and design of the strategy leaves aside the fact that its implementation raises some important problems in relation to the organizational design of the company, such as the need or not to define units specific organizational arrangements, the number and size of the Strategic Business Units or responsibility and the degree of autonomy in decision-making adequate to implement the strategy.
This double approach of the Strategic Business Units, oriented towards the strategic formulation or its implementation, does not usually coincide, which decisively affects the way in which the Strategic Business Units are defined, as well as the role they play. throughout the organization. (Ministry of Transport, 2000)
Many authors agree on the need to define intermediate units of analysis between the global and the particular. These intermediate analysis units, or Strategic Business Units, can be defined with two well differentiated purposes and not always the same.
A first purpose is the original aimed at formulating the most appropriate strategies. In this sense, the Strategic Business Units would be “Strategic Planning Units”, which would allow to better define the competitive strategy that can be more successful in each type of activity or business. We can call this approach to defining the Strategic Business Units "strategy formulation" as this aspect predominates in their construction.
A second approach would consider the Strategic Business Units, as pre-existing or not organizational units, with their own activities and functions around a set of products or markets to which they are directed. This approach to defining the Strategic Business Units is called "implementation of strategies"; as it is the organizational support on which the strategy is developed, the criterion that prevails in the construction of the Strategic Business Units.
The approach or approach of the Strategic Business Units, as "Units of strategy formulation"; It arises initially as a response to the need to rethink the strategic planning process and therefore with a purpose clearly oriented to that end.
According to Hall, (1978) "The diversified company should be managed as a 'business portfolio', with each business unit serving a clearly defined product / market segment, with a clearly defined strategy."
But according to Gluck, Kauman and Walleck, (1980) the Strategic Business Units; they are sufficiently large and homogeneous organizational entities so that they can exercise effective control over most of the factors that affect their business.
Similarly, for Aaker, (1987) a Strategic Business Unit is an organizational unit that has, or should have, a defined company strategy and that has a manager with responsibility for sales and profits.
Menguzzato and Renau, (1991) consider that each Strategic Unit is a set of activities or businesses, homogeneous from a strategic point of view and in turn different from the appropriate strategy for other activities and / or strategic units.
According to this implantation approach, according to Golden (1992), the criteria for the identification and delimitation of Business Units do not have to coincide with those related to the strategy formulation approach. Being able to highlight as more important the following factors:
- The strategies formulated at the business level, so that the organizational structure would try to adapt to the needs and criteria of strategic planning. The current structure in the company may be the greatest determining factor for the definition of strategic business units. In diversified companies, the classic divisional structure can be the main reference element to the point that in many cases the concept of business unit is identified with that of division or with a grouping of these. The size of the company is another conditioning factor in such a way that it would not make sense to define strategic business units that are too small, even if they have their own strategic sense, since they could not accumulate the resources and functions necessary to justify their independent existence.Similarly, homogeneous but too large strategic business units would not make sense since they would be unmanageable from an organizational point of view. The material and human resources shared by the different businesses also affect the construction of business units, since the duplication of those can be extremely costly for the company, making it necessary to group the shared resources in the same Strategic Unit of business.since the duplication of those can be extremely costly for the company, so it is necessary to group the shared resources in the same Strategic Business Unit.since the duplication of those can be extremely costly for the company, so it is necessary to group the shared resources in the same Strategic Business Unit.
As can be seen in this approach to implementing the strategy, practical criteria predominate, linked to the feasibility of implementing a competitive strategy, which is related not only to its formulation, but also to the current organizational structure and with the usual design criteria.
In summary, the Ministry of Transportation agrees (2000) that: “The Strategic Business Unit constitutes a basic instrument of the strategic management process, with multiple activities. It is a concept that arises as an intermediate analysis unit between the global level and the functional level of the strategy, to facilitate the strategic planning of the different activities or business of a company ”.
The Strategic Business Units are the main ingredient of the well-known portfolio matrices that were so successful in the 1970s for strategic planning in diversified companies.
The portfolio, portfolio or business portfolios of a company generally includes a set of offers distributed in various Strategic Business Units: they are the center of planning because they contribute to the fulfillment of the mission of organizations by concentrating efforts on the main strategies.
An effective process of the business portfolio requires periodically analyzing the creation of value by each of the Strategic Business Units and checking its coherence with the strategic vision of the company that was defined at the time. It is necessary to know in which businesses value is being created and which ones are destroying it, understand what is the additional value provided by the strategic plans presented by the Strategic Business Units and set the monitoring parameters that allow the progress achieved to be measured. (López, 2007).
Conclusions
This paper offers a summary of some of the main criteria on the subject of strategic planning and its link with Marketing, in addition to making reference to the role of Strategic Business Units as a planning tool.
The material can be a reference document for teachers and students interested in studying the subject.
Bibliographic references
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