Harward Business Reviw Artical published July-August 1980 By: Frederick W. Gluck, Stephen P. Kaufman, and A. Steven Walleck. the paper include four phases: Phase 1 : Basic financial planning Phase 2 : Forecast based planning Phase 3 : Externally oriented planning Phase 4 : Strategic management

2. HBRJuly-August 1980
Strategic Management for
Competitive Advantage
By: Frederick W. Gluck, Stephen P. Kaufman,
andA. StevenWalleck

3. Presented By:
 SANAULLAH
 ZOHAIB AHMED
 SOFIA FATIMA
 SUNDAS SETHI

5. INTRODUCTION
 The planners all have turned
into strategists
 Performances of some large,
complex multicultural
corporations turned to the
strategic management
 The question is raisesWhy the
companies like Apple,
Mitsubishi are so successful

6. INTRODUCTION
Cont…
In the case:
Companies are segmented into four sequential phases:
 Explicit formulation of issues and alternatives
 Quality of stake holders
 Top management to prepare and guide
strategic decision process
 Effectiveness of implementations

7. The four phase model is used to evaluate corporate planning system
and processes and for indicating ways of improving their effectiveness
THE 4-PHASE MODEL
Phase 1 : Basic financial planning
Phase 2 : Forecast based planning
Phase 3 : Externally oriented planning
Phase 4 : Strategic management

8. THE 4-PHASE MODEL
Phase 1 : Basic financial
planning
Phase 2 : Forecast based
planning
Phase 3 : Externally
oriented planning
Phase 4 : Strategic
management
 It is the annual budgeting process
 The things are changed to the financial
problem
 There is a financial forecasting done at the
annual bases which content the revenues and
costs

9. THE 4-PHASE MODEL
Phase 1 : Basic financial
planning
Phase 2 : Forecast based
planning
Phase 3 : Externally
oriented planning
Phase 4 : Strategic
management
Internal trend analysis:
 Past financial status of the company
External trend analysis: (PESTL elements)
 Political
 Economical
 Social
 Technological and
 Legal

10. THE 4-PHASE MODEL
Phase 1 : Basic financial
planning
Phase 2 : Forecast based
planning
Phase 3 : Externally
oriented planning
Phase 4 : Strategic
management
 Following factors are put in glance before
developing the planning
• Developing new business capabilities
• Defining markets according to
companies Strengths
 PESTL factor oriented
 The SBU concept:
• Grouping of related business
• Strategic planning Packed in pieces
• SBU recognizes two distinct strategic
levels
o Corporate decisions
o Business decisions

11. THE 4-PHASE MODEL
Phase 1 : Basic financial
planning
Phase 2 : Forecast based
planning
Phase 3 : Externally
oriented planning
Phase 4 : Strategic
management
 Strategic management + Planning = a single
process by SM
 It include:
1. Planning framework
2. Planning process
3. Corporate values

12. 4-PHASES IN EVALUATIONOF FORMAL
STRETEGIC PLANNING
Phase 1:
Basic financial
planning
Phase 2:
Forecast-based
planning
Phase 3:
Externally oriented
planning
Phase 4:
Strategic
management
Effectiveness of
formal business
planning
Meet budget Predict the future Think strategically Create the future
Value
system