The corporate planning and development is a constant ,never ending and ongoing process in which a company first, defines its philosophy ,mission and vision in a strategic plan, and then uses that plan to direct ,monitor and manage the business .strategic planning detailed operational planning and increasing performance.
Corporate planning can also defined as the process of drawing up detailed action plans to achieve an organization goals and objective, taking into consideration number of resources of the organization and the environment within which it operates .corporate planning represents a formal, a way in achieving objectives and to implementing the corporate strategy of an organization. It has traditionally been seen has the responsibility of senior management.
There is no formula for corporate planning and the activities encompasses are often the role of the CEO or the other executives .however particularly in larger companies corporate development is provided as a character for a particular executive team. We have been speaking of future but now forward should look and plan for the current as well as future corporate planning cannot work in isolation it has directly to interact with the outside world environments in which it operates the business trends of the industry in which operates effect the planning .likewise the policy of the government,the competitor and their planning
Just as management team may be ramp. corporate development may also be employed to change the current focus for clients .this may mean looking into the potential for breaking into new markets with the existing products or developing complementary products that will allow this type of expansion. As part of this type of approach corporate company and replaced with people who posses skills required to move company forward .when these is the case the corporate development team will handle the function of recruiters and evaluation of potential hires.
From the article a few things article clears that corporate planning involves planning with an eye for the future .it involves the setting up a predetermined course of action to achieve certain goals of the future .It involves the setting up of the goal and these objectives which we could set out to achieve .means to chalk out a path we need some destination that we have to reach and that destination in the case of corporate planning is the goal and the objective that are to be achieved by the company. So the first step would logically be to the set goal and the objective is to be achieved.
As in the article we have seen earlier planning means keeping an eye on future and working in the proper manner. Preparing company for the future planning is dynamic process the future becomes the present and the company must take changes in its plan accordingly .The course on which the company has set itself needs to be accessed against the current requirement and corrective action need to be taken. Opportunities and threats that come in the future need to be anticipated and the company needs to be prepared for it. The opportunities need to be converted into business and the threat needs to be taken care of.
Corporate development refers to the planning and execution of a wide range of strategies to meet specified organizational objectives. There are various activities following under the since of activities which come under corporate planning and development may include intimidates such s requirement of a new management team, plans for planning in or out of certain markets or products ,establishing relationship with strategic ,and need of finding security ,finance, divesting of asset or divisions.
Process of corporate development can also be applied to the task of growing the company through mergers and acquisitions .In this scenario the project development will involve identifying potential target companies for acquisitions or unions resulting in a new and more aggressive corporation. Corporate planning is never ending process need to be studied detail
The team will consider all possible outcomes from any given potential merger or acquisition and attempt to project if the action is likely to the result in positive growth or a could possibility, impair the company permanently. There is no one tried and true formula for the process of corporate development the actual structure of the corporate strategy will depend greatly on the current circumstances of the company and the area where the development is desired . In most cases the process will not be of short duration; corporate development is usually process that makes take place over an extended period of time and may be adjusted or refined as the project moves forward.
Need of corporate planning
Helps in finding tactical and operational dependent plans based on strategic vision and direction
Optimize asset utilization including capacity and materials
Simplify make /buy decisions.
React faster to market changes.
Adjust your strategic plan frequently
Perform long range planning and analysis to determine the impact of simultaneous business decision combinations. Measure and compare your supply chain management and check performance against competition.
Corporate planning provides opportunities in following ways
2. Problem solving
3 make adjustments
4. Lateral thinking
6. goal setting
Function of corporate planning
You can organize
You direct organization
You can control organization
You can get results
Corporate planning is primary seed of any organization
There are 5 dimension of corporate planning:
Time: as seen earlier there are basically two plans long term and short term plan. the long term plan is five years or more and the period of the short term plan is one year .the long term plan is broken down into the short term plan .planning is continuous process and taken future considerations and working to meet challenges that conmen in the way of company.
Entity is an area for which planning is to be done it could be done for anything like improving the sales
Improving the sales, productivity, labor turnover, finance, marketing new product that is to be planned and launched anything that comes under the purview of the company can be planned for, goals and objectives should be set for each of these entities.
Master plan should be set for the whole organization and then should be broken done for its subsidiaries and products this help in aligning the goal and objectives of the organization with that of subsidiaries.
A corporate plan consists of several elements. The process of corporate planning states with the setting up of the mission and the goals that the company proposes to achieve in the future. The company would then release its policy statement which could be philosophy, culture approach and style of the functioning of the top of management. Of the company. One important component of the plan are the budgets that needs to be set to achieve each objective .budgets are usually set for each area of operation e.g. sales ,marketing, production. The performance is compared with the budget to evaluate the success of the plan.
The basic characteristics of a corporate plan are the goal that is the set of resources that will help in achieving the goal, important miles stone in the path towards achievement of goal the corporate plan should be communicated to all those who are concerned with it and should be easy understood. A corporate plan is in quantitative and qualitative term. Corporate plan comprises of the long term as well as short term plan the long term plan is flexible it his to change as per the change in various factors that affect it in short term short term plan is not flexible and is not subject to the future and the strength and weakness of the organization.
Benefits of corporate planning:
There is saying in farmers as you sow you will reap the same is in corporate planning
This is because:
- Opportunity to need and determine the environmental impact on the organization and business
- Opportunity to determine organization s weakness and strong points
- Opportunity to determine threat to business
- Opportunity to determine and develop strategic plans for company
- Opportunity to develop a vision for company
- Opportunity to needed to enhance business related strategies for organization
- Opportunity to develop objective of organization
- Opportunity to develop vision for organization
- Opportunity to enhance long term as well short term plan
- Opportunity to develop mission statement for organization
Steps in developing corporate planning include:
- Mission statement
- Vision statement
- core purpose
- Core markets
- core strategic thrusts
Limitation of corporate planning
The limitation of corporate planning are not with the corporate planning itself buts its implemented /how much it is managed:
1. Lack of active participation by the members during planning sessions
2. Lack of effective follow up review on regular basis
3. Corporate planning not being used as a corporate development tool
4. Lack know how in using
5. Lack of training of the member in change management