{"id":19734,"date":"2019-08-27T20:19:20","date_gmt":"2019-08-27T20:19:20","guid":{"rendered":"https:\/\/essays.homeworkacetutors.com\/2019\/08\/the-relationship-between-strategic-management-and-marketing-business-essay\/"},"modified":"2019-08-27T20:19:20","modified_gmt":"2019-08-27T20:19:20","slug":"the-relationship-between-strategic-management-and-marketing-business-essay","status":"publish","type":"post","link":"https:\/\/www.colapapers.com\/us\/the-relationship-between-strategic-management-and-marketing-business-essay\/","title":{"rendered":"The Relationship Between Strategic Management And Marketing Business Essay"},"content":{"rendered":"
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In today\u2019s industry, change is the only constant. All organisations are faced with fierce competition and need right direction of grasping new opportunities or conquering difficulties (Obeng and Ugboro, 2008; Daniel, 1992; Martinet, 2010; Ansoff, 1991). Hence, this report is concerned with an important problem in utilizing strategy\u00a0and strategic planning in the areas of marketing and strategic management to benefit companies.\u00a0Several questions are identified: what is strategy, strategic planning and strategic management, what is the linkage between strategic management and marketing, what are useful tools used in marketing planning process, and how strategic management benefits organisation. Because of understanding the marketing operating environment is very important for managers to establish effective marketing strategies (Kolter and Armstrong, 2010), this report illustrates several useful tools to support managers to scan the environment. A case study of Starwood Hotels & Resorts Worldwide, Inc. and its sub brand W Hotels are used to demonstrate how strategic planning and strategic management benefits the companies in the real world.<\/p>\n

The Definition and Benefits of Strategy and Strategy Planning<\/h2>\n

Johnson, Scholes, and Whittington (2008) defined strategy as a long-term direction and scope to help organisation develop advantages in a changing environment by exploiting its resources and competences to satisfy stakeholder expectations. However, strategy is not equal to strategic planning (Piercy, 2009). Hellriegel, Jackson, and Slocum (2005:9) indicate that planning is \u2018the determination of organisation goals and the means to reach them\u2019. Daniel (1992) argued that effective strategic planning includes improving business financial performance, understanding the advantage of the company and increasing the ability to response inconsistent environment. Hellriegel, Jackson, and Slocum (2005) identified that strategic planning is the process to help organisations diagnose their overall environments, set up a vision and mission to develop comprehensive goals, create feasible strategies, and allocate resources. In other words, strategic planning focuses on developing strategies that lead the organisations dealing effectively with environmental opportunities and threats in relation to their strengths and weaknesses. Recent studies reported that strategic planning remains a valuable tool within diverse area (Ugboro et al., 2011; Obeng and Ugboro, 2008; Soteriou and Coccossis, 2010), also including hotel industry (Simonceska, 2010; Peters and Buhalis, 2004; Phillips et al., 1999; Phillips and Appiah-Adu, 1998), for companies to increase possibility of continuing survival and effectiveness in its constantly changing environment (Kotler and Armstrong, 2010).<\/p>\n

Strategic Planning Steps<\/h2>\n

The company begins strategic planning with defining its overall mission, setting goal and objectives, and designing business portfolio (Kolter and Armstrong, 2010). Organisation with clear mission statement has better financial performance and organisational commitment (\u00c5\u017eent\u00fcrk, 2012). For example, Starwood Hotels & Resorts Worldwide, Inc. claimed that:<\/p>\n

To shareholders, our goal is to grow EBITDA at least 8-10% per year and EPS at least 15% per year; to customers, we want Starwood to be the easiest company with which to do business; and to employees, our commitment is to make Starwood a great place.<\/p>\n

These statements convey the broad ideas of Regent group to its customers, employees and stakeholders and support them to set reachable goals. Business portfolio is identified as \u2018the collection of business and products to make up the company\u2019 to enable organisation analyzing its current and future developing strategies (Kotler and Armstrong, 2010:65). The Boston Consulting Group (BCG) Growth-Share Matrix, using market growth rate as vertical axis and relative market share as horizontal axis, is an efficient tool to evaluate the performance of company\u2019s strategic business units (SBUs), which can be a company division, product, or brand, and develop strategies for growth or downsizing. For instance, Starwood Hotels & Resorts Worldwide, Inc. has nine hotel brands worldwide. Managers can analyze the performances of each subsidiary\u00a0hotel based on their financial reports in the matrix. If the brand is located in the stars area, heavy investments will be needed to finance its rapid growth. Therefore, expansion is a considerable strategy in that region. The funds can be retrieved from other brands positioned in cash cows area, which operating stably and generating profits, or close hotels in question marks to reduce unnecessary costs.<\/p>\n

The Definition of Strategic Management<\/h2>\n

Strategic management is a broad scope of strategic planning which deals with contemplates strategy implementation, grasps emerging bottom-up strategies, connect strategies, structures and management systems and try to balance economical calculus with power and political processes in and around the \u00ac\u0081rm (Ansoff, 1974; Martinet, 2010). Ansoff (1974) indicates that strategic management is a systemic approach rather than analytical reduction and positivism and focus on future-oriented real-time integrative management. Johnson et al (2008:11) argues that strategic management is concerned with \u2018complexity arising out of ambiguous and non-routine situations with organisationwide rather than operation-specific management.\u2019 Three stages are involved in strategic management: strategic analysis\/strategic position, strategic choice, and strategic implementation (Johnson and Scholes, 1988; Johnson et al, 2008). Strategic position focuses on the how an organisation will react when environment changes to satisfy its stakeholders by reallocating its resources. Strategic choice directs a firm to generate and evaluate strategies and select appropriate options to compete with rivals by grasping new opportunities or conquering difficulties. Strategic implementation facilitates managers to transform decision into action.<\/p>\n

The Relationship between Strategic Management and Marketing<\/h2>\n

Since Kolter and Keller (2012) identify marketing as the process of creating value for customers and construct long-turn relationship with customers, strategic management enables managers to convert strategies into practice and collect information in the complex and non-routine marketing environments in a systematic way. Marketing environments are recognized as the \u2018catch-all expression for anything outside the control of the firm which will affect its ability to achieve its marketing objectives\u2019 (Brennan, 1995:7); it can divide into macro-environment and micro-environment. In the first stage of strategic management, the several tools can help marketing managers scan the marketing macro-environment to diagnose the external opportunities and threats outside the company. The PESTEL (political, economic, social, technological, environmental, and legal) framework is an interrelated tool to analyze the uncontrollable macro-environment trend of the firm (Johnson et al, 2008). Politics represents the governmental policy; Economics refers to the macro-economic factors, for example exchange rates, inflation rate and economic growth; Social factors involve changing cultures and demographics, Jews forbid to eat pork; Technological factors stands for technological aspect such as R&D activity and Internet; Environmental include ecological and environmental aspects especially for green issues; and finally Legal influences highlight legislative restrictions or modifications that will affect companies\u2019 operating strategies. The W brand decided to enter in Taiwan market is a good illustration of political factor. Taiwan government published tourism policy to attract more tourists from China in 2009. Due to China is considered as the largest tourism sources in the world, this promising policy will benefits hotel industry in Taiwan.<\/p>\n

Porter\u2019s five forces framework helps companies identify their potential ultimate profit in microenvironment, which close to the company that affects it ability to serve its customers (Kotler and Armstrong, 2010). Five forces, consisting of (1) the threat of entry, (2) the threat of substitutes to the industry\u2019s products or services, (3) the power of customers, (4) the power of suppliers and (5) the extent of rivalry between competitors in the industry (Porter, 1979), are examined to understand competitive intensity of the industry and therefore develop opportunities for business. The threat of entry refers to the barriers of entering the industry. Developing economic scale, monopolizing distribution channel and differentiation are common barriers for existing competitors to create advantages to prevent new entries. The threat of substitutes is considered as the alternatives providing similar function to customers from outside the incumbents\u2019 industry. Alternatives providing lower price or better value might change customers\u2019 original choice and reduce the demand of particular products they supposed to buy. Powerful suppliers and buyers may capture the company\u2019s potential profits because they have the ability to bargain the products\u2019 price. Competitive rivals offering similar products or service in the same competing sector or industry will decrease organisations\u2019 profits. Thus, high entry barriers and powerful buyers\u2019 bargaining power enable the company to prevent competitors. For example, since the entire hotel industry will benefit from the Chinese-attracting tourism policy, W Taipei faces lots of potential five-star hotel competitors as the threat of entry; or substitutes, such as other ranks of hotels, B&B, or private hotels, might take over the market share.<\/p>\n

Conclusion<\/h2>\n

To conclude, strategic planning is the analytical thinking aligns the strategies with the organisation\u2019s goals and capabilities and its changing marketing environments (Kolter and Armstrong, 2010). Strategic management, otherwise, is the ability of a firm\u2019s management to \u2018properly align itself with the forces driving change in the environment in which it competes (\u00c5\u017eent\u00fcrk, 2012)\u2019 in a systematic manner. Several tools, such as BCG matrix, PESTEL framework, and Porter\u2019s five forces framework, facilitate marketing managers to scan the environmental change and create more efficient strategies and practical plan to achieve organisation\u2019s mission. Hence, it is crucial for managers to take advantage of those tools to establish right strategies in right circumstances for company\u2019s sustainability.<\/p>\n

References<\/h2>\n

Ansoff, H.I., Declerck, R.P. and Hayes, R.L. (1974) From Strategic Planning to Strategic Management. New York: Wiley.<\/p>\n

Ansoff, H. I. (1991) \u2018Critique of Henry Mintzberg\u2019s \u2018the Design School: Reconsidering the Basic Premises of Strategic Management\u2019. Strategic Management Journal, 12(6) pp. 449-461.<\/p>\n

Brennan, R. (1995) Cases in marketing management. London: Pitman, pp.3-53.<\/p>\n

Daniel, A. L. (1992) \u2018Strategic planning-The role of the chief executive.\u2019 Long Range Planning, 25(2) pp. 97-104.<\/p>\n

Hellriegel, D., Jackson, S. and Slocum, J.W. (2005). Management: A Competency-based Approach. 10th ed, Mason: Thomson\/South-Western, pp. 2-33.<\/p>\n

Johnson, G. and Scholes, K. (1988) Exploring Corporate Strategy. 2 nd \u00a0ed.,\u00a0 London: Prentice-Hall, pp.1-50.<\/p>\n

Kotler, P. and Armstrong, G. (2010) Principles of Marketing. 13th ed., Pearson Prentice Hall, pp. 60-87.<\/p>\n

Martinet, A.-C. (2010) \u2018Strategic planning, strategic management, strategic foresight: The seminal work of H. Igor Ansoff.\u2019 Technological Forecasting and Social Change, 77(9) pp. 1485-1487.<\/p>\n

Obeng, K. and Ugboro, I. (2008) \u2018Effective strategic planning in public transit systems.\u2019 Transportation Research Part E: Logistics and Transportation Review, 44(3) pp. 420-439.<\/p>\n

Peters, M. and Buhalis, D. (2004) \u2018Family hotel businesses: strategic planning and the need for education and training.\u2019 Education & Training, 46(8\/9) pp. 406-415.<\/p>\n

Phillips, P. and Appiah-Adu, K. (1998) \u2018Benchmarking to improve the strategic planning process in the hotel sector.\u2019 The Service Industries Journal, 18(1) pp. 1-17.<\/p>\n

Phillips, P., Davies, F. and Moutinho, L. (1999) \u2018The interactive effects of strategic planning on hotel performance: a neural network analysis.\u2019 Management Decision, 37(3) pp. 279-288.<\/p>\n

Piercy N. (2009) Market-led Strategic Change: Transforming the Process of Going to Market. 4 th ed., Oxford: Butterworh-Heinemann.<\/p>\n

Porter, M. E. (1979) \u2018How competitive forces shape strategy.\u2019 Harvard Business Review\u00a0, 57(2) pp. 137-145.<\/p>\n

\u00c5\u017eent\u00fcrk, F. K. (2012) \u2018A Study to Determine the Usage of Strategic Management Tools in the Hotel Industry.\u2019 Procedia \u2013 Social and Behavioral Sciences, 58(0) pp. 11-18.<\/p>\n

Simonceska, D. (2010) \u2018Relationship Between the Strategic Planning, Distinctive Capabilities and Competitors Advantage of The Hotel Product.\u2019 Tourism & Hospitality Management, 10 (1) pp. 616-625.<\/p>\n

Soteriou, E. C. and Coccossis, H. (2010) \u2018Integrating Sustainability into the Strategic Planning of National Tourism Organizations.\u2019 Journal of Travel Research, 49(2) pp. 191-205.<\/p>\n

Ugboro, I. O., Obeng, K. and Spann, O. (2011) \u2018Strategic Planning As an Effective Tool of Strategic Management in Public Sector Organizations: Evidence From Public Transit Organizations.\u2019 Administration & Society, 43(1) pp. 87-123.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

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