Chapter 1 - Planning Flashcards
4 Characteristics of a plan
- Simplicity.
- must be simple. - Practicality.
- realistic. - Severability.
- aggregate of parts. - Flexibility.
- must allow for mid term changes.
2 Disadvantages of bottom-up approach
- Management may feel they lack control.
2. Business units fully into “their” plan, not accepting of changes made by management.
Near environment
- Factors over which brokerage may have an influence.
- Main tool used is profiling.
- client profiling.
- market profiling.
- competitor profiling.
Distant environment
Factors critical to long term survival. Brokerage has no control or influence. -economy -social/demographic forces -technological change -government action
Advantages/Disadvantages to top-down approach
- Management feels firmly in control and in charge.
- Employees had no part in developing. it’s “managements” plan.
3 Keys to successful implementation
- Controlling implementation.
- mobilize resources, get the right people to the right place. - Linking budgets to strategies, objectives, and goals.
- Motivating for implementation.
- common problem is that employees are not focused on accomplishing same objectives.
Characteristics of action plan
- Consists of specific tasks to support the strategic plan.
- Apply to particular business unit.
- One year timeline
- Detailed
- Focus on how strategic plan will be achieved.
Define Mission
Defines where brokerage is headed.
-What will we achieve?
Define Strategy
Long term (3-5 years) battle plan. -Describes how brokerage intends to achieve mission.
Define Objective
Refines broad mission and strategies into concrete actions.
Analyzing the internal environment - What does the brokerage need to know?
- What it does better than competitors.
- What strengths aren’t being used effectively.
- What it’s weaknesses are.
- Financial strength.
- How strong human resources are.
Defining a corporate focus
VVM
- Vision
- Value
- Mission
What is the purpose of the strategic plan?
- Asses the future.
- Structure for dealing with risks/uncertainty.
- Consider backup plans for responding to change.
- Determine the purpose and direction of the brokerage.
Competitor profiling.
Gathering information such as size, financial condition, location, products, service, and public image.
Market profiling.
Identifying and analyzing factors in the market which may affect the brokerage.
