This document provides an overview of strategic formulation concepts including vision, mission, policies, objectives, goals, and balanced scorecard. It defines each concept and discusses key elements such as the definition of vision, features of a good mission statement, differences between policies and strategies, factors that influence objective setting, and the various perspectives considered in a balanced scorecard. Examples of visions and missions from organizations like NASA, NTPC, Apple, and others are also provided. The document was prepared by Prof. Jitendra Patel of Prestige Institute of Management and Research to outline important components of strategic formulation.

1. Strategic Management
Prepared By
Prof. Jitendra Patel
Assistant Professor
Prestige Institute of Management
and Research. Indore.

2. Strategic Formulation

3. Strategic Formulation
2.1Vision
2.1.1Definition of Vision
2.1.2 Features of Vision
2.1.3 Process of Creating Vision
2.1.4 Vision of Different Organization
2.2Mission
2.2.1 Definition of Mission
2.2.2 Why Mission is Needed
2.2.3 Features of Mission
2.2.4 Element of Mission Statement
2.2.5 Process of Creating Mission
2.2.6 Mission of Different Organization
2.2.7 Vision VS Mission
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4. Strategic Formulation
2.3Policies
2.3.1Definition of Business Policies
2.3.2 Features of Business Policies
2.3.3 Policies Vs Strategies
2.4Objectives
2.4.1 Definition of Objectives
2.4.2Why objectives is needed
2.4.3 Features of Objectives
2.4.4 Hierarchy of Objectives
2.4.5 Issue in Objective Setting
2.4.6 Factor effecting Objective Setting
2.4.7 Objective of Indian Railways
2.4.8 Long term Vs Short term Objective
2.5 Goals
2.5.1 Definition
2.6 Balanced Score Card
2.6.1 Perspective of Balanced Score Card
2.6.2 Strategic Mapping
2.7 Strategic Intent
2.7.1 Hierarchy of Strategic Intent2/11/2020 4
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5. VISION
• Vision is a Description of something(an
organization, a corporate culture, a
business , a technology, an activity) in the
future.
• Vision is a mental perception of the kind
of an organization aspires to create within
a board time horizon and the underlying
conditions for the actualization of this
perception
• Vision is a category of intentions that are
board, all inclusive and forward thinking.
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6. Process of creating Vision
Vision
Core
Ideology
Core Value
Core
Purpose
Envisioned
Future
Long-Term
Goals
Vivid
Description
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7. Features of Vision
• Creating an identity and a sense of
purpose for an organization
• Inspiring the organization to achieve the
aim
• Fostering long term thinking in an
organization
• Making sense in market place by being
competitive , unique and original
• Elevating the energy and self esteem of
all the employees in the organization.
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8. Vision of Different Organization
• Amazon.com. Our vision is to be Earth's
most customer centric company; to build
a place where people can come to find
and discover anything they might want to
buy online.
• Nike: “ To bring inspiration and
innovation to every athlete in the world”
• If you have a body then you are a athlete.
• Toys “R” Us: “Our vision is to put joy in
kids hearts and a smile on Parents Face”
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9. Vision of Different Organization
• NASA(National Aeronautics and Space
Administration) : To fly something that
someone have not even imagine.
• Vision of NTPC
• “To be the world’s largest and best power
producer, powering India’s growth.”
• Apple Vision
• "To produce high-quality, low cost, easy to use
products that incorporate high technology for
the individual. We are proving that high
technology does not have to be intimidating for
noncomputer experts."
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10. Bhel
• Vision : A global Engineering enterprise providing
solutions for better tomorrow.
• Indian Railway:
• Vision
• Indian Railways shall provide safe, efficient,
affordable, customer-focused and environmentally
sustainable integrated transportation solutions. It
shall be a modern vehicle of inclusive growth,
connecting regions, communities, ports and centers
of industry, commerce, tourism and pilgrimage across
the country.
•
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11. • To be the leading provider of financial
services in India and a major global bank
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12. "Inspire the World, Create the Future."
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13. Microsoft
• Vision Statement To build a customer
service oriented professional services
Sales force automation. Our focus will
always be on strategy, education, and
customer satisfaction. As business people
first and IT consultants second
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14. • Coca Cola: To Create moment of happiness
and Optimism in the word.
• Disney: We create happiness by providing the
finest entertainment for people of all ages
everywhere.
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15. • Our Vision
• Our vision serves as the framework for our Roadmap and guides every
aspect of our business by describing what we need to accomplish in
order to continue achieving sustainable, quality growth.
• People: Be a great place to work where people are inspired to be the
best they can be.
• Portfolio: Bring to the world a portfolio of quality beverage brands that
anticipate and satisfy people's desires and needs.
• Partners: Nurture a winning network of customers and suppliers,
together we create mutual, enduring value.
• Planet: Be a responsible citizen that makes a difference by helping build
and support sustainable communities.
• Profit: Maximize long-term return to shareowners while being mindful
of our overall responsibilities.
• Productivity: Be a highly effective, lean and fast-moving organization.
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16. Mission
• Definition : Mission is a purpose or reason
for organization existence.
• Mission is essential purpose of the
organization, concerning particularly why
it is in existence, the nature of business(es)
it is in and the customers it serve and
satisfy.
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17. Why Mission is Needed
• Serves as focal point to identify the
organization’s purpose and direction
• Develop a basis or standard for allocating
organizational resources
• Helps in motivating the employees to use the
resource efficiently
• Ensures stability of the purpose within the
organization
• Facilitates the transformation of objectives
and goals into the work structure of an
organization
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18. Feature of the Mission
• Feasible: Implies that a mission statement should be
realistic in nature . The mission statement should aim
high , but should not be impossible to achieve.
• Clear: The mission statement should be transparent,
i.e. it should not be complex and unclear in nature.
• Motivational: Implies that the mission statement
should encourages the member of the organization to
work towards the organizational goal.
• Unique: the mission statement should be unique and
distinctive to attract the attention of the society. The
mission statement should be well received by society.
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19. Element of Mission Statement
1. Customer: who are the firm’s customers?
2. Products or Services: what are firm’s major products
or services?
3. Markets: Geographically, where does the firm
compete?
4. Technology : Is the firm technologically current?
5. Concern for survival, growth and profitability: Is the
firm committed to growth and financial soundness.
6. Philosophy : what are the basic beliefs, values,
aspirations and ethical priorities of the firm?
7. Self-concept : what are firm’s distinctive competence
or major competitive advantage?
8. Concern for public image: is the firm responsive to
social , community and environmental concerns
9. Concern for employees: Are employees a valuable
assets of the firm?2/11/2020 19
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20. Process of creating Mission
Formulating A
Mission
Defining the
Business
Analyzing the
Vision
statement
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21. Process of Creating the Mission
• Analyzing the Vision Statement
• Defining the Business
1. Scope of the business
2. Stakeholders of the business
3. Purpose of the business
4. Customers of the business
5. Techniques and methods employed in the
business
• Formulating a Mission
1. Strategies for future operations
2. Key values of business
3. Code of conduct for the business operations
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22. Elements of Mission Statement
• History of the organization
the important characteristics of the past should
be considered for formulating and development a
mission statement
• Environment of the Organization: Refers to
identifying the opportunities and threats by the
environment
• Specification of Products or Services: implies that
the mission statement should specify the products
or services that are produced by an organization
• Market’s and Consumer Description: Implies that
mission statement should clearly describe the
markets and customer that an organization
intends to serve
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23. Mission of different Organization
• BHEL Mission
• Providing sustainable business solution in the
field of energy, industry and infrastructure.
• Indian Railway Mission
• Protect and safeguard Railway property,
Passengers and Passenger area
• - Ensure the safety, security and boost the
confidence of the traveling public in the Indian
Railways
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24. Mission of different Organization
• NASA Mission
• pioneer the future in space exploration,
scientific discovery and aeronautics
research.
• NTPC Mission
• Develop and provide reliable power, related
products and services at competitive prices,
integrating multiple energy sources with
innovative and eco-friendly technologies and
contribute to society.”
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25. Apple Mission
• "Apple is committed to ensuring the highest
standards of social responsibility in everything
we do. The companies we do business with
must provide safe working conditions, treat
employees fairly, and use environmentally
responsible manufacturing processes
wherever Apple products are made. "
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26. COCACOLA
• Our Mission
• To refresh the world...
• To inspire moments of optimism and
happiness...
• To create value and make a difference.
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27. • Google’s mission is to organize the
world’s information and make it
universally accessible and useful.
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28. • Mission:
• We will leverage our people, technology, speed and financial capital to:
• be the banker of first choice for our customers by delivering high quality,
world-class products and services.
• expand the frontiers of our business globally.
• play a proactive role in the full realization of India’s potential.
• maintain a healthy financial profile and diversify our earnings across
businesses and geographies.
• maintain high standards of governance and ethics.
• contribute positively to the various countries and markets in which we
operate.
• create value for our stakeholders
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Indore

29. Microsoft
• Mission Statement Our purpose is to provide
unique and value added professional
services in the technology industry.
Furthermore, do so with a very high level of
customer service and security and with our
customers best interest in mind . Through
education, strategy, customer service,
excellent work, and fair compensation,
create customer loyalty.
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30. Mission VS Vision
Mission Vision
About
A Mission statement talks about HOW you
will get to where you want to be. Defines the
purpose and primary objectives related to
your customer needs and team values.
A Vision statement outlines
WHERE you want to be.
Communicates both the purpose
and values of your business.
Answer
It answers the question, “What do we do? What
makes us different?”
It answers the question, “Where do
we aim to be?”
Time
A mission statement talks about the present
leading to its future.
A vision statement talks about your
future.
Function
It lists the broad goals for which the organization
is formed. Its prime function is internal; to define
the key measure or measures of the organization's
success and its prime audience is the leadership,
team and stockholders.
It lists where you see yourself some
years from now. It inspires you to
give your best. It shapes your
understanding of why you are
working here.
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31. Mission VS Vision
Mission Vision
Change
Your mission statement may change, but it should
still tie back to your core values, customer needs
and vision.
As your organization evolves, you
might feel tempted to change your
vision. However, mission or vision
statements explain your
organization's foundation, so
change should be kept to a
minimum.
Developing
a statement
What do we do today? For whom do we do it?
What is the benefit? In other words, Why we do
what we do? What, For Whom and Why?
Where do we want to be going
forward? When do we want to reach
that stage? How do we want to do
it?
Features of
an effective
statement
Purpose and values of the organization: Who are
the organization's primary "clients"
(stakeholders)? What are the responsibilities of
the organization towards the clients?
Clarity and lack of ambiguity:
Describing a bright future (hope);
Memorable and engaging
expression; realistic aspirations,
achievable; alignment with
organizational values and culture.
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32. Business Policy
Definition of Business Policy
Business Policy defines the scope or spheres within which decisions
can be taken by the subordinates in an organization.
• It permits the lower level management to deal with the
problems and issues without consulting top level management
every time for decisions.
• Business policies are the guidelines developed by an organization
to govern its actions.
• They define the limits within which decisions must be made.
• Business policy also deals with acquisition of resources with
which organizational goals can be achieved.
• Business policy is the study of the roles and responsibilities of top
level management, the significant issues affecting organizational
success and the decisions affecting organization in long-run.
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33. Features of Business Policy
Specific- Policy should be specific/definite. If it is uncertain, then the implementation will become
difficult.
Clear- Policy must be unambiguous. It should avoid use of jargons and connotations. There
should be no misunderstandings in following the policy.
Reliable/Uniform- Policy must be uniform enough so that it can be efficiently followed by the
subordinates.
Appropriate- Policy should be appropriate to the present organizational goal.
Simple- A policy should be simple and easily understood by all in the organization.
Inclusive/Comprehensive- In order to have a wide scope, a policy must be comprehensive.
Flexible- Policy should be flexible in operation/application. This does not imply that a policy
should be altered always, but it should be wide in scope so as to ensure that the line
managers use them in repetitive/routine scenarios.
Stable- Policy should be stable else it will lead to indecisiveness and uncertainty in minds of those
who look into it for guidance.
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34. Business Policy Vs Strategy
Policy Strategy
Policy is a blueprint of the organizational
activities which are repetitive/routine in
nature
strategy is concerned with those
organizational decisions which have not
been dealt/faced before in same form.
Policy formulation is responsibility of top
level management
strategy formulation is basically done by
middle level management.
Policy deals with routine/daily activities
essential for effective and efficient
running of an organization
strategy deals with strategic decisions.
Policy is concerned with both thought and
actions
strategy is concerned mostly with action.
A policy is what is, or what is not done. strategy is the methodology used to
achieve a target as prescribed by a policy.
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35. Objectives Definition
• A specific result that
a person or system aims to achieve within
a time frame and with available resources.
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36. Why objectives is needed
• Define the relationship of an organization
with its internal and external environment
• Provide the basis for strategic decision
• Help in pursuing the vision and mission
• Provide a yardstick for measuring the
performance of the organization
• Serve as a motivating force to achieve the
organizational goals
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Indore

37. Feature of Objectives
• Understandable
• Specific time- horizon
• Set within the constraints
• Measurable and Controllable
• Form a hierarchy
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38. HIERARCHY OF OBJECTIVES
Corporate level
objective
TOP
MANAGEMENT
Divisional and
Department Objectives
MIDDLE
MANAGEMENT
Individual and Performance Based
Objectives
LOWER MANAGEMENT
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39. 2/11/2020 39
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40. 2/11/2020 40
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41. 2/11/2020 41
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42. Issue in objectives setting
• Specificity
• Quality
• Verifiability
• Multiplicity
• Periodicity
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43. Factors affecting the objectives
• Environmental Forces
• Availability of Resources
• Value of Top Management
• Awareness of Past Objectives
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44. Objectives of Indian Railway
• - Carry on an unrelenting fight against
criminals in protecting railway passengers,
passenger area and Railway property.
• - Facilitate passenger-travel and security by
removing all anti-social elements from
trains, railway premises and passenger area.
• - Remain vigilant to prevent trafficking in
women and children and take appropriate
action to rehabilitate destitute children
found in Railway areas.
• - Co-operate with other departments of the
Railways in improving the efficiency and
image of the Indian Railways.
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45. • Act as a bridge between the Government
Railway Police/local police and the
Railway administration.
• - Adopt proactively all modern
technology, best human rights practices,
management techniques and special
measures for protection of female and
elderly passengers and children.
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46. Long Term Objective Vs Short Term Objective
Short Term Objective Long Term Objective
Short-term objectives represent the goals
an organization sets that are centered on
tasks
Longer-term objectives are generally
more inspirational in nature and so tend
to relate to a period of five years plus.
Short-term objectives represent the goals
tasks that can be achieved within the next
six months or, at the outset, within one
year.
Long-term objectives define any goal that
has a time frame exceeding one year
An example of a short-term goal might be
to increase sales by 10 percent.
Business goals that are normally
considered long term include developing
a new product, growing annual revenue
and developing a comprehensive
marketing and public relations strategy
This is an easily measurable goal and
employees can be held directly
accountable for ensuring that it is met.
long-term goals must not go on forever.
While they take more time than short-
term objectives, long-term goals must be
realistic and time bound
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47. Goals
• They are concrete( generally quantified )
formulations of achievements , that the
organization aims for within a set periods
of time.
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48. Balanced Score Card
• The balanced scorecard is a strategic planning and management
system that is used extensively in business and industry,
government, and nonprofit organizations worldwide .
• to align business activities to the vision and strategy of the
organization.
• improve internal and external communications, and monitor
organization performance against strategic goals.
• It was originated by Drs. Robert Kaplan (Harvard Business School)
and David Norton as a performance measurement framework that
added strategic non-financial performance measures to traditional
financial metrics to give managers and executives a more 'balanced'
view of organizational performance.
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49. Perspectives of Balanced Score Card
The balanced scorecard suggests that we view the organization from four perspectives, and
to develop metrics, collect data and analyze it relative to each of these perspectives:
• The Learning & Growth Perspective
• This perspective includes employee training and corporate cultural attitudes related to both
individual and corporate self-improvement. In a knowledge-worker organization, people --
the only repository of knowledge -- are the main resource. In the current climate of rapid
technological change, it is becoming necessary for knowledge workers to be in a continuous
learning mode. Metrics can be put into place to guide managers in focusing training funds
where they can help the most. In any case, learning and growth constitute the essential
foundation for success of any knowledge-worker organization.
• The Business Process Perspective
• This perspective refers to internal business processes. Metrics based on this perspective
allow the managers to know how well their business is running, and whether its products and
services conform to customer requirements (the mission). These metrics have to be carefully
designed by those who know these processes most intimately; with our unique missions
these are not something that can be developed by outside consultants.
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50. Perspectives of Balanced Score Card
• The Customer Perspective
• Recent management philosophy has shown an increasing realization of the
importance of customer focus and customer satisfaction in any business. These are
leading indicators: if customers are not satisfied, they will eventually find other
suppliers that will meet their needs. Poor performance from this perspective is
thus a leading indicator of future decline, even though the current financial picture
may look good.
• In developing metrics for satisfaction, customers should be analyzed in terms of
kinds of customers and the kinds of processes for which we are providing a
product or service to those customer groups
• The Financial Perspective
• Kaplan and Norton do not disregard the traditional need for financial data. Timely
and accurate funding data will always be a priority, and managers will do whatever
necessary to provide it. In fact, often there is more than enough handling and
processing of financial data. With the implementation of a corporate database, it is
hoped that more of the processing can be centralized and automated. But the
point is that the current emphasis on financials leads to the "unbalanced" situation
with regard to other perspectives. There is perhaps a need to include additional
financial-related data, such as risk assessment and cost-benefit data, in this
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51. Balanced Score Card
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52. Strategy Mapping
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53. Hierarchy of Strategic Intent and
Process

54. Reference
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Thirteenth Edition, Prentice Hall, South Carolina, USA.
2. Dess, G.G., Lumpkin, G.T. and Marilyn, L. T. (2005), “Strategic
Management”. 2 ed. New York: McGraw-Hill Irwin.
3. Kazmi, A. (2008),“Strategic Management & Business Policy,
Tata McGraw-Hill Publishing Company Limited, New Delhi.
4. Ihrig , M and MacMillan, I (2015) “MANAGING YOUR MISSION-
CRITICAL KNOWLEDGE” Harvard Business Review, 81-87.
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and Cases Sixth Edition South-Western Cengage Learning.

55. Reference
7. Olsen, E (2009), “Strategic Planning Kit For Dummies”, 2nd
Edition, Willey Publication.
8. Rohm, H ., Wilsey , D. , Perry , G. , and Montgomery , D.
(2013), “The Institute Way: Simplify Strategic Planning &
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Effective Mission and Vision Statements Strategic Planning
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