Undertaking strategic case studies

This section provides a generalized framework for analysing and preparing case studies of a strategic nature.
Case studies and their suggested solutions are available in another document. It will help you to gain an
understanding of the ideas and skills of marketing management and should improve your skills as a practising
manager.

What is a case study?

A case study is normally a description of a situation which may be factually based or fictional. The student must
then analyse this and make recommendations or answer a number of specific questions. Such cases can be
general, encompassing many different areas, or specific, where only a few issues or a single issue is raised. The
cases we use in Section 4 are ones which we believe raise key strategic marketing issues.

Analysing case studies: key steps

1 Reading the case/familiarization
It might sound obvious, but the first step in analysing a case study starts with reading the case and beginning to
familiarize oneself with the company, markets, characters in the case and so on. Obvious it might sound, but
case study examiners will often confirm that it is often patently obvious that a candidate has not read the case, at
least not thoroughly. Here are some tips on familiarizing yourself with a case study.
(a) First, read through the case quickly several times to familiarize yourself with the situation.
(b) At this early stage do not make any notes. Even if you have been given specific questions on the case,
try to keep an open mind as to the key issues. You should simply be considering the facts of the case.
Examples of what you are looking for at this stage include:
Activities of the company: products/markets, etc.,
Major competitors
Company organization, structure, functions, etc.
Marketing mix policies: products, price, place, promotion

2 Situation analysis
This starts the analysis of the case proper using the following procedure:

Assess information in the case

This is not a discrete step. Throughout a case analysis there is a continual need to assess and reassess the
information. However, at this initial stage what one is after is the establishment of a data bank of information
which is contained in the case. This data bank can be organized in a variety of ways according to the
circumstances of a particular case. For example, where the case study involves questions, the data from various
parts of the case can be begun to be assembled under each question topic.

A useful way to begin to build this data bank, and hence to explore key issues for more detailed analysis later in
the preparation is, having read through the case several times, to assemble a page by page synopsis of the salient
facts of the case as seen by the reader, together with any initial thoughts that these facts prompt with respect to
possible marketing issues and case questions if included.

At this stage the strong temptation to prepare answers to the case or questions should be resisted. It is more an
issue of organizing the information in the case in a way which makes it easier to use and interpret at a later
stage. However, it is important to appraise critically the status of information in a case. Information in a case
should be assessed to the extent that it is:
Reliable
Complete
Precise
Valid

The information should also be examined for any gaps. This can prove useful at a later stage in suggesting areas
for further research.

Marketing audit
The marketing audit is an essential step in preparing marketing plans. In the context of a case study, the audit
consists of a detailed appraisal of the company in the case and its marketing environment. The aim is to build a
complete marketing picture of the company, so that a SWOT analysis can be prepared. In carrying out a
marketing audit it is useful to use a checklist approach. No checklist can be totally complete, nor will every item
on the list always be relevant. With these caveats in mind the following table includes what is considered to be a
useful starter checklist for analysing most cases.

Marketing audit: checklist of factors

EXTERNAL/ENVIRONMENTAL FACTORS
Analyse for current position and trends/changes these factors as they affect the company in the case study

Macro-environment
Political/legal/fiscal
Taxation
Regulatory constraints
Duty/excise
Trading blocks
Patent law
Labour laws
Economic
Disposable income;
Inflation
Unemployment
Exchange rates
Interest rates
Taxation
Currency stability
Socio-Cultural
Demographic needs
Education levels
Attitudes/beliefs/values
Lifestyle
Religion
Consumerism
Technological
Manufacturing processes
Raw Materials
Innovation and technological change

Market environment
Total market
Size volume and value
Growth volume and value
Trends volume and value
Competitors
Number
Strengths/weaknesses
Barriers to entry/exit
Strategies
Profitability
Shares
Mergers/takeovers
Customers
Needs/wants
Buying patterns
Brand loyalty
Segments
Distributors
 Principal channels
Trends in channels
Purchasing strength/power
Location
Terms and conditions of sale e.g. margins
Physical distribution/logistics
Suppliers
Number/types
Bargaining strengths
Location

INTERNAL ENVIRONMENT
Factors affecting the internal environment of the company in the case study
Detailed marketing activity
Total sales by volume/value
Market share by volume/value
Trends in the above
Sales by products, customer, geographical areas
Marketing mix elements
Pricing strategies, discounts, etc.
Products range, features, quality, product life cycles, customer service, branding
Promotion types, spend, media, sales force activities, organization, etc.
Place channels used, stock levels, warehousing, delivery systems, etc.
Financial aspects
Profits and margins
Cost structures
Liquidity and cash flow
Asset structure
Debt/equity structure
Capital investment levels

Audit of marketing systems, procedures, organization, etc. This part of the internal company audit should
encompass the following:
Planning systems
Information gathering/marketing research
Current company and marketing objectives
Current strategies and tactics
Control and budgeting systems
Planning systems; their effectiveness and efficiency
Organization and staffing
Overall company and marketing organization structures
Coordination and conflict between marketing and other functional areas e.g. production, finance, R&D
Marketing and sales staff: responsibilities, authority, skills and experience

The next stage in a case study analysis is to prioritize the major findings from the audit. We now turn to this
next stage the SWOT analysis.
Analysing strengths, weaknesses, opportunities and threats (SWOT)
Having completed the marketing audit, the next stage is to analyse and present the information in a format
which is useful and relevant to marketing decisions and strategies. This is best done by preparing an analysis of
the strengths, weaknesses, opportunities and threats facing the company in the case.

In compiling the SWOT it is important to recognize that strengths and weaknesses essentially stem from the
audit of the internal company environment, whereas opportunities and threats will stem from trends and changes
in the factors covered in your audit of external environmental factors and these are appraised together for the
specific company in the case study. It should be remembered that, for example, rapidly changing technology in
an industry can represent either an opportunity or a threat to an individual company according to their own
blend of strengths and weaknesses. Clearly, a company that is flexible with good planning and forecasting
systems and effective new product planning would probably view rapid technological change as an opportunity
rather than a threat.

Similarly, what seems at face value to be an apparent strength in a company e.g. established products, dominant
market share and so on, may well turn out to be weaknesses when set against external environmental trends and
changes e.g. dominant market share may be a weakness if monopoly and fair trading legislation is planned by
the government.

Identifying and prioritizing major problems and opportunities: selection of key issues
Having made a list of the SWOT elements we then need to move onto the next step which is to condense the
SWOT even further to produce a concise and prioritized list of major problems and opportunities facing the
company in the case, enabling the selection of key issues for the next stage. The relationship between the
marketing audit, the SWOT analysis, the identification of major problems and opportunities and selection of key
issues is shown in the Figure:

From marketing audit to selection of key issues

Gradually Marketing audit Work from a

refine and broad non-
distil the interpretive
information approach to a
in the case SWOT analysis focused
interpretation
of what the
information in
Identification of the case
major problems and means for the
major opportunities company and
the key issues

Selection of key
issues

Techniques for identifying key issues

One way in which key issues can be detected is to distinguish between what commonly exists and the desired
state for the future
The gap that exists between SW area and the OT area in SWOT analysis is a rich source for key issues
detection
It is important not to consider issues in isolation, for in effect there is usually a causal relationship, which can
be quite complex and hence multivariate in origin
Distinction must be drawn between symptoms and fundamental issues to ensure that the outcomes expected
and planned for actually occur
It is useful to distinguish between existing issues and anticipated issues. For the latter, using the SWOT
analysis, this classification can be further divided into areas for opportunity exploitation and areas to avert the
risk of implementing threats
Key issues decided should be capable of action and hence they need to be prioritized with reference to the
scale of the issues specified and the time scale for overcoming them; hence the use of a time scale running
from the immediate term to the long term over specified years and months is useful
In many case studies, key issues may be difficult to define. It is useful, therefore, to distinguish between the
following problem areas:
(a) Actual explicit issues: provided by clues in the text of the case itself, or in the questions set in
the case
(b) Concealed issues: identified by your analysis of the case
(c) Potential issues, which may arise in the future for the company, and/or on the examination day
itself
 The key issues in the case study scenarios must ultimately be assessed in terms of who and what is affected
and to what extent the issue is controllable and by whom
Key issues can often be highlighted by the imposition of criteria for organizational assessment. It is against
such standards that issues which previously had not bee identified become revealed.

Further detailed analysis of major issues identified

Having identified key issues in the previous step we are then in a position to analyse these areas in more depth,
using quantitative and qualitative techniques and tools of market and financial analysis. Applying such tools will
not only provide a deeper insight into the problems and issues facing the company in the case, but it may also
require redefinition of the problem areas. For example, what from an initial analysis of the case may appear to
be a problem of, say, loss of market share may, upon further analysis, turn out to be a problem of falling
industry sales. Only an in-depth analysis of the information and facts contained in the case will enable us to
determine what the real problems and opportunities are.

Specifying assumptions and identifying resource constraints

Constraints may impose problems upon an organization. They may also provide the limits within which
problems can be identified and researched. By now a detailed analysis of the information in the case should
enable us to highlight the constraints, both internal and external, which provide limits to organizational
performance and will therefore serve to begin to shape the framework for the subsequent stages, where we begin
to develop marketing strategies. For example, the analysis may show that the market as a whole is declining, or
that the company in the case has limited financial and/or staff resources, etc. Clearly, these types of constrain
must be taken account of in shaping future strategies for the company.

Similarly, as in real life, often we will have to make assumptions before we can proceed to develop strategies.
These assumptions can encompass many and varied areas relating to the case e.g. we may have to make
assumptions regarding trends and developments in the macro-environment like rates of inflation or political
developments. Such assumptions are likely to be particularly important in assessing the SWOT analysis. We
should make as few assumptions as possible, but where it is felt necessary we should be clear what these are. In
this initial stage of analysis we should explicitly write down our assumptions so that we are reminded of them
later when it comes to proposing action.

Financial analysis ratio

Throughout this first step of the analysis we will need to draw upon many of the relevant techniques and
concepts of modern marketing, but most case studies require some familiarity with financial matters. This text is
not designed to provide a comprehensive review of financial techniques, but in a case study you will find that
the most useful set of financial assessment techniques if financial ratio analysis. To facilitate your initial
analysis of cases, we have detailed some of the more useful ratios which you might analys from case study
profit and loss accounts and balance sheets.

Basic financial ratios in analysing case studies

Liquidity ratios
These are used to assess the companys ability to meet current financial obligations.
(a) Current ratio
Formula Current assets divided by current liabilities
Interpretation The number of times current liabilities are covered by current assets. This is a fairly
crude measure expressing the companys ability to meet current obligations with a margin of safety, which may
arise from the varying quality of the current assets, particularly with reference to stocks and the status of
debtors. A more critical measure is the quick ratio or acid test
(b) Acid test
Formula Quick assets divided by current liabilities
Interpretation The number of times current liabilities are covered by quick assets. Quick assets are
cash or near cash items, but not stock because it may not be quickly converted to cash. Quick assets are
often considered as current assets minus stocks. In most cases this is cash plus debtors, a critical measure
which should be in the ratio of 1:1
Profitability ratios
These are used to assess the companys profit performance with reference to the direct costs and indirect costs
of the business and the associated control of both in relation to sales performance.
(a) Gross profit percentage
Formula Gross profit divided by sales, multiplied by 100
 Interpretation As a percentage of sales revenue, gross profit is the margin created from absolute
sales for the period minus the direct costs represented by the cost of sales
(b) Net profit percentage
Formula Net profit before tax and depreciation divided by sales, multiplied by 100
Interpretation Net profit or loss is the result of charging the indirect costs as revenue expenses of
the business against the gross profit margin. To present an objective picture of the net profit figure as taken
before depreciation has been charged and corporation tax deducted
(c) Return on total assets
Formula Net profit divided by total assets, multiplied by 100
Interpretation This ratio measures the rate of profitability achieved on the total assets of the
business. Much will depend upon the accuracy of the assets valuation in the companys balance sheet.
There is frequent debate over which profit figure to use. The key is to be consistent throughout the analysis.
Options include:
The figure used in the net profit per cent ratio
Net profit after tax
In either case, it is considered appropriate to add back the interest charged on long-term debt to
demonstrate objectively the companys capability to produce profits from total asset utilization
(d) Return on capital employed
Formula Net profit before tax and long-term interest divided by total capital employed,
multiplied by 100
Interpretation This is considered to be the primary ratio from which family trees of ratios can be
extended to form a pyramid. It expresses the efficiency of management and measures its performance to
generate a rate of return on total capital and reserve of the business
(e) Return on owners equity
Formula Pre-tax profits divided by equity capital, multiplied by 100
Interpretation This ratio measures the rate of return on the owners investment in the business. As a
percentage, absolute return can also be measured for every 100 invested
Funds management
These ratios are used to assess how efficiently the company uses the available working capital, particularly with
reference to inventory holding, debt collection and payment.
(a) Debtors collection period
Formula Debtors divided by sales, multiplied by 365 days
Interpretation This ratio determines the time taken by the company to collect debts. It provides a
clear indication of the efficiency of credit control
(b) Average payment period
Formula Creditors divided by purchase, multiplied by 365 days
Interpretation This ratio determines the average time taken for the company to pay its bills. The
relationship between (a) and (b) above gives an indication of how the company manages cash flow
(c) Stock turnover
Formula Sales divided by closing stock
Interpretation This ratio measures the rate at which stock moves through the business. A more
critical measure can be made by taking the cost of sales figure. The ratio is expressed as the number of
times stock is turned. If this is then divided into 365 days one can assess the number of days or months
stocks which are tied up in the company which might be an indicator of poor inventory control
Ability to borrow
These ratios demonstrate the position of the company in relation to the level of indebtedness and the
management of the capital structures
(a) Debt ratio
Formula Current liabilities divided by total assets, multiplied by 100
Interpretation This ratio measures the percentage value of the current liabilities in relation to the
total asset value of the business. This demonstrates the amount of current short-term indebtedness which is
covered by the companys assets and hence the companys ability to pay off current liabilities from the sale
of total assets
(b) Capital gearing ratio
Formula Fixed interest capital divided by shareholders funds, multiplied by 100
Interpretation This ratio reflects the percentage of fixed interest capital and business commitments
in relation to the shareholders funds. It shows the relative position of creditors to the business owners
stake in the company. The fixed interest capital figure is also called net debt and is calculated by adding
long-term debt to debentures to overdraft and short-term loans less the cash the company has as a current
asset
Step 3 Generation and selection of alternative action plans
The first two steps in the analysis of a case study are essentially focused on assessing where the company in the
case is now. This third, and more difficult step, takes us from analysis to action. At this stage we are now
required to make a substantial conceptual leap from analysis and problem definition to suggesting alternative
solutions and action plans. In preparing action plans the strategic marketing planning framework in Chapter 1
needs to be assessed, according to the circumstances of the particular case and any specific questions attached.
For the purpose of completeness, the key steps in strategic marketing are now reproduced

1. The corporate plan remit

The corporate mission statement needs detailed consideration by top management to establish the business the
company is really in and to relate this consideration to future business intentions. It is a general statement that
provides an integrating function for the business, from which a clear sense of business definition and direction
can be achieved.

This stage, which is the starting point for overall corporate planning (elements of which are: human resource,
marketing, operations, financial and logistics) is often overlooked in marketing planning; yet without it, the plan
will lack a sense of contribution to the development of the total business. By deriving a clear mission statement,
boundaries for the corporate entity can be conceived in the context of environmental trends that influence the
business.

It is helpful to establish areas of distinctive competence and in so doing, focus upon what customers are buying
rather than upon what the company is selling. This will assist in the development of a more marketing oriented
mission statement; it therefore takes into account trends in market consumption patterns. A clear mission
statement should include customer groups to be served, customer needs to be served and the technologies to be
utilized.

Corporate objectives of the organization are time dependent, designed to achieve shareholder expectations.
These should be derived from the mission statement to ensure integration within a corporate and marketing
planning system.

The time horizon to achieve corporate objectives will vary between organizations, from market to market and
from country to country, with time-scales stretching from one to five or even to 20 or more years.
From a practical viewpoint, both quantitative and qualitative objectives are required to provide the foundation
upon which measurable marketing activities can be planned. In particular, quantitative corporate objectives are
concerned with rates of return on capital employed and invested, return on shareholder funds etc., and these are
inextricably linked to the companys financial year where these key ratios are used as indicators of annual
financial performance. Qualitative corporate objectives may relate to image, stance, positioning, projection,
appeal, identity and recognition and it is possible to apply quantitative criteria to each of these to make their
analysis to make them more objective.

Objectives are statements of what is to be achieved and hence provide the stimulus for strategy, i.e. the means
by which the objectives will be achieved. Because these objectives are corporate and have company-wide
parameters, balance is needed for the attainment of integration in the organization as a whole.
Areas to consider when setting up corporate level objectives include: market standing; innovation; productivity;
physical and financial resources; staff performance, development and attitude; public responsibility and
profitability/financial health.

Corporate constraints are an important consideration. It is the matching of ambition to the ability to maximize
performance that is a perennial task which besets senior management. Corporate constraints are the limiting
factors that govern corporate capability. As the process of planning is iterative, a clearer understanding of these
constraints may arise at subsequent stages in the planning process.
A full appreciation of corporate capability at this stage will affect more realistic resource deployment at later
stages in the marketing plan and will assist cross-functional plans which collectively are designed to achieve
corporate level objectives.

2 The marketing audit

In most business enterprises, periodic financial reviews are mandatory and systems are established to ensure that
these occur within the deadlines set. This should be the case with marketing, but rarely is it so formalized.
Essentially the marketing audit is a systematic internal and external environmental review of the company's
marketing performance for a given period of time. This review provides the basis for subsequent SWOT
analysis (i.e. a review of company Strengths, Weaknesses, Opportunities and Threats).

The purpose of auditing the external internal environment of the organization is to separate controllable from
uncontrollable variables that have an impact on corporate performance. Companies should develop a customized
checklist of factors for examination that can then be reviewed systematically and periodically.
The external audit will examine PEST factors - Political, Economic, Socio-cultural and Technological in the
general business environment. Later consideration added the legal impact of these on company operations and
the definition was broadened to SLEPT. Later thinking adds Environmental to this classification which makes
the acronym PESTLE and now Ecological has now made the acronym STEEPLE. In addition, a
comprehensive market profile is required with a detailed understanding of market movements so that forecasts
can be developed for market performance and changes thereto. To support this market profile, the company
must place itself in the context of a competitive market environment and a comprehensive profile of competition
must be obtained, together with an examination of competitive product offerings.

Internally, a thorough examination of the companys marketing performance is vital. Detailed sales analysis,
market shares and profit contribution analysis must be undertaken, together with an assessment of the efficiency
of the companys marketing mix and marketing control plans and procedures.

The process of auditing raises a series of questions and produces a series of discoveries. These will need to be
compiled into an acceptable format for presentation, a format from which later stages of the plan can be
developed. This format is known as the SWOT analysis. The PEST analysis is effectively the antecedent to the
SWOT analysis.

3 SWOT analysis
This acronym classifies results of the audit into internal current strengths and weaknesses that largely concern
controllable variables, and external future opportunities and threats that largely concern uncontrollable
variables.

The SWOT analysis used for presentation should be a succinct summary of the audit which concentrates upon
main issues for resolution, and for which objectives, strategies and tactics could be set if required. In effect this
is a series of bullet points under each of the SWOT elements rather than a dialogue.

4 Assumptions
To move forward from analysis to planning, a conceptual transition is required because something has to be
achieved from that which has been assessed, discovered and recorded.

A potential drawback of planning is that if not careful it can become and end in itself. What this means is that in
some organisations, particularly those where planning is done centrally using specialist planning staff, extensive
and sophisticated analysis is carried out, but little of this feeds into and affects actual marketing plans and
activities at divisional or individual brand level. There are reasons for this, but a frequent one is simply a lack of
communication between planners and implementers. Surprisingly, in many organisations brand mangers are
unaware of the organizations mission and vision statements or have not been informed about market
developments and forecasts which may have significant implications for their brands. Another reason is a
possible clash of cultures when two previously independent organisations come together. Initially, when the UK
supermarket group, Morrisons, first acquired their competitor, Safeway, in 2003 there were problems bringing
together the marketing plans and strategies of each group into one coherent whole. However the senior
management of both companies were eventually able to do this and the new combined company has made
significant inroads into the market ever since.

Environmental scanning of the market and analysis of competitive and market situations leads to the statement
of assumptions for a future planning time horizon. To avoid the need for assumptions, we would have to have
perfect knowledge which is rare. It is upon the statement of assumptions that progress can be made to the
planning stage. Assumptions can be classified as internal and external, quantitative and qualitative, in the same
format as prescribed for corporate constraints.
5 Time-scales
It is normal practice to design at least an annual marketing plan that coordinates with the fiscal year of the
organization and hence integrates with the budgetary control and associated management information and
control systems. Some companies then extend the planning horizon to a separate plan for around five years, or
incrementally on a rolling planning basis. A rolling planning principle ensures plans are at least one year ahead
and revised and updated quarterly.

6 Marketing objectives
Objectives are statements of what is to be achieved and strategies are means of achieving objectives.
It is important to realize that marketing objectives should be derived directly from corporate level objectives
and, in turn, reflect both quantitative and qualitative criteria. Concentration should be focused on setting
objectives for products and markets, because corporate level objectives reflect product/market combinations.
Marketing mix objectives, that relate to price, product, place and promotion (each dealt with as individual
chapters) can be separated out at a later stage.

This simplifies the process of setting marketing objectives, but they must be actionable, achievable and
measurable, otherwise the accomplishment of marketing strategies cannot be accurately assessed in the time-
scale of the plan.

7 Marketing strategies
Strategy is the means by which objectives are achieved. If objectives specify what is to be done, strategy lays
down how it is to be done.

A predetermined strategy leads to a series of action statements which are a clear set of steps to be followed to
achieve the determined strategy. These actions are known as tactics.

Effective marketing strategy is critical to the success of the plan. It must exploit the strengths and opportunities,
overcome weaknesses and avoid threats identified in the SWOT analysis.

A strategic marketing programme depends upon an incisive SWOT analysis arising from a clear definition of
planned marketing activity as company success is governed by marketing strategy. A company's marketing
strategy is the basis upon which operational decisions are made and corporate and marketing objectives
achieved within the time periods specified for the plan. The time period for the tactical plan is usually one year
i.e. the current operating year. It is through the tactical plan that marketing strategy is achieved in practice.

The strategic element of the marketing plan concentrates on the selection of target markets, positioning
strategies and the planning and implementation of the elements of the marketing mix that includes product,
price, place and promotion, and in the case of service products/markets, the extended marketing mix elements of
people, process and physical evidence.

Marketing research at this stage should provide a vital strategic contribution to the plan.

A key part of the strategic element of the marketing plan is often overlooked, and this is the policy statement.
This provides the guidelines by which the marketing strategy can be accomplished within determined time
planning horizons.

As part of strategic determination, it is common practice to identify alternative means by which specified
marketing objectives can be achieved. Criteria for evaluation are then set, applied to the stated alternatives and
the best course of action selected.

The intention of marketing mix strategy is to achieve marketing positioning for product/market combinations
specified in the corporate and marketing objectives sectors. Therefore, market definition, market segmentation
and market targeting are prerequisites within which positioning must be achieved.
An idea first put forward by Weihrich in 1982 provides a useful means of applying SWOT analysis principles to
form marketing strategies. This is termed the TOWS matrix which brings together company strengths and
weaknesses and links them with external opportunities and threats to form specific strategies by using elements
from the SWOT analysis. For example, consider a small regional bakery where the following SWOT has been
produced:
STRENGTHS WEAKNESSES
1. Well established brand 1. Production semi-automated
2. In business since 1922 2. Only sold in one region of the country
3. Good reviews relating to quality 3. Promotion tends to be word of mouth
4. Reasonable prices 4. No representatives
5. Family firm with contented workforce 5. Only a limited range of breads
6. No debts or borrowings and good reserves
7. Premises can easily be expanded to at least
double capacity

OPPORTUNITIES
1. Local transport company has offered
deliveries to a wider area
2. To produce a wider range of products
3. Capitalize on strong brand position
THREATS
1. Large national bakeries are expanding to organise
into the region
2. Large supermarkets entering into strategic alliances
with national bakeries for the production of cakes
3. Recession means that many households are now baking
more at home

Suggested marketing strategies using TOWS are:

Strengths 1 and 2; Weakness 3; Opportunity 2 produces: Use long established brand name and word of
mouth promotion to develop and retail products other than bread;

Strength 7; Weakness 2; Opportunity 1 produces: Expand production to enter larger market in other regions
using alliance with local transport company.

Weakness 1; Strength 6; Threats 1 and 2 produces: Use spare capital to update production facilities to counter
expansion plans from national bakeries.

8 Detailed marketing programmes

The level of marketing strategy will vary from plan to plan and company to company, but the final intention is
to put the plan into action. It is now time to construct a set of detailed action programmes to achieve the
previously stated marketing strategy. This part of the plan is concerned with who should do what, where, when,
how and why. In this way responsibility, accountability and action over a specified time-scale can be planned,
scheduled, implemented and reviewed.

9 Sales forecast
In many companies, the sales plan will be separated from the marketing plan or even replace the marketing plan
in a sales oriented situation. However, if we adopt marketing as a business philosophy then sales must be
included within the marketing plan it is the means by which many of the plans objectives will be achieved.
Sales forecasts and budgets will provide the means for quantitative achievement and control.
Selling and sales management strategy and tactics should be designed to complement, support and integrate with
the marketing mix, components of marketing strategy in particular promotion and distribution.

10 Staffing the plan

Objectives and strategy can only be achieved through people, structures, systems and methods. In the tactical
section of the plan, responsibility and authority for operations should be designated to appropriate individuals.
This requires company-wide consideration for organizational and staff development, to bring about any changes
required to meet the objectives of the plan.

Training and career development programmes, remuneration systems, numbers of staff required, etc., are
important considerations, and this will require liaison with the human resource function.

11 Contingency measures
Despite planning ahead for change, environmental factors sometimes force us to change a course of action
often these factors are unforeseeable and frustrating. The time taken to adjust may be less than we would like
because of a desire by management to avoid higher costs and incurring losses. Under such conditions, response
to contingency situations becomes reactive. To minimize the impact of changed environmental circumstances,
companies can be proactive by using contingency thinking to anticipate likely events that may occur, and then
make plans to reconcile the changed position in which the company might then be placed.

For each element of marketing mix and sales strategy, the marketing planner should ask the question: What if?
In so doing, a change scenario will be formulated; a scenario to which the company can choose to respond. By
planning ahead, the impact of changes will be reduced. Such thinking, when used in marketing planning,
encourages control and may avoid expensive mistakes. Ironically, if the international banking sector had applied
such thinking before the late 2008 financial meltdown then costly blunders might have been anticipated and
appropriate contingency planning applied in good time.

The marketing planner should refer back to the assumptions set previously and consider the impact on the plan
if these are not fulfilled.

12 Budgets reviews and controls

A marketing plan cannot be operated without some element of control to monitor and measure progress.
A system of controls should be laid down whereby the plan is reviewed on a systematic basis, and updated to
extend the horizon to the prescribed time-scale. Controls are needed to assess tactics and strategy in the progress
towards the achievement of quantitative and qualitative objectives. These controls should be both quantitative
and qualitative in design.

The marketing information system, and in turn the management information system, provide essential inputs to
the control system, but the organization depends on people to work the system through regular appraisal.
Comparison of performance against target and the coincident variance analysis will enable corrective action to
be taken to further exploit marketing and market opportunities and threats. Contingency planning is a form of
control that can and should be used, particularly where markets are volatile.
For companies using a formal system of marketing planning, the budget is the means by which the entire plan is
coordinated financially. Each area of marketing activity should be costed and allocated to centres of
responsibility. As a key functional area the marketing budget is one of the key budgets to contribute towards the
total budgetary control system.

Budgeting is the transitional step between planning and implementation, because the budget, and allocated
centres within it, will project the cost of each activity over the specified period of time, and also act as a guide
for implementation and control.

This overview of the strategic marketing planning framework is brief. In practice developing strategic marketing
plans is complex and multifaceted. This complexity is heightened by the fact that the process is essentially an
iterative one, with the planner constantly having to return to earlier stages in the analysis and planning as final
plans begin to emerge. In addition, the various elements of the marketing plan need to be consistent, one with
another. Marketing mix elements of product, price, place and promotion need to blend into one coherent
package. The mix elements must be consistent with overall corporate and marketing objectives, in particular
with segmentation, targeting and positioning strategies. The whole process is one of constant checking and re-
checking, not only in the preparation of the plan, but throughout its operation.
The figure sets out the steps in marketing planning into this wider framework, together with the key elements of
analysis that feed into the decision-making steps. In addition, the interrelationships and iterative steps in the
process are also shown. It looks complex, but represents a logical and ordered approach to the strategic
marketing planning process.
 MISSION STATEMENT

MACRO-ENVIRONMENT SITUATIONAL ANALYSIS COMPANY AUDIT

Political, Economic, Socio- Audits of all major company functions

cultural and Technological - Marketing, Finance, HRM,
(PEST) STRENGTHS, WEAKNESSES, Production, Distribution

Figure 1.4 OPPORTUNITIES, THREATS

The strategic ANALYSIS (SWOT)
marketing
planning process

MARKETING OBJECTIVES
Feedback

FORECAST MARKET POTENTIAL

GENERATE MARKETING STRATEGIES

ASSUMPTIONS AND CONTINGENCY PLANS

PREPARE DETAILED MARKETING MIX PROGRAMMES

BUDGET RESOURCES INCLUDING STAFFING

AGREE TIME-SCALES

IMPLEMENT THE PLAN

MEASURE AND CONTROL

The key steps shown in this framework are universal inasmuch as they remain essentially the same, irrespective
of the nature of a company, e.g. its size, nature of product markets, geographical dispersion etc, and may be
followed by the marketing manager preparing a strategic marketing plan for an individual Strategic Business
Unit.

Marketing and marketers operate in a dynamic environment. As a result, marketing concepts and applications
are constantly evolving and changing, so the strategic marketing planner must consider these when formulating
plans. Because of this, although the basic elements shown in the framework for strategic planning remain
essentially the same, it is useful to conclude this chapter by briefly outlining some of the more recent
developments and trends in marketing thinking and application, together with some of the more important
potential implications of these for marketing management.

Final note on writing up case studies

Given that most marketing case studies are testing and developing management skills, it is conventional to write
up an analysis of a case study in a report type format. The convention for structuring a report varies
considerably, but should you be unfamiliar with the structure of a report we have included a simple outline of
how to prepare one.

1. Planning a report on a case study

The planning stage starts with the purpose of the report, what is to be included, how it is to be
presented, and to whom it is to be presented. Sectionalizing the report and the use of clear headings,
especially where a case includes a number of separate questions, will help to produce a good report, but
so too will starting the report itself with a statement of terms of reference.

2. Terms of reference
At the start of a report it is a good idea to write out the terms of reference so that it can be demonstrated
that you understand precisely what you have been asked to do. Terms of reference should include the
following:

Who the report is for and by whom it has been requested, e.g. At the request of the marketing
manager of XYZ Company..
The areas to be covered (i.e. the questions restated in heading format) e.g.
# Methods of entry into overseas markets
# The promotional mix
# Pricing strategies
The intended outcome of the report, e.g.
# To establish strategies for developing export markets..
# To make proposals for a coordinated promotional campaign.
The constraints and assumptions (if any) that affect the report e.g.
# Within a proposed budget for promotion of 80,000.
# In compiling the report it has been assumed that the rate of inflation will continue to be 2 per cent
per annum.

3. Proposals and recommendations

Remember that reports are not extended written assignments, they are concise statements which set out
your thoughts simply and clearly. In most reports it is the proposals and recommendations that are of
prime interest (although clearly these must be based on a sound analysis).

All proposals and recommendations should be justified to support them, but do not bore the reader with
an overcomplicated or in-depth analysis. For the most part, any detailed calculations and analysis, if
required in the report, should form part of the appendices.

4. Structuring the report

The conventions for structuring a report vary considerably. Here is one example of a report structure
you could use:
# Title page Title of report, to whom addressed, the date, authors name, company, etc.
# Terms of reference Resume of terms of reference as above
 # Contents list Report structure together with the numbering system which is used throughout
the report. Major headings and sub-headings to be shown
# The main report This should include the detailed facts and recommendations contained in the
report
# Appendices So that the main flow of argument is not interrupted by a mass of detail, financial
and other data can be summarized or referred to in the report, but attached at the end. As an alternative,
you could insert a summary of the main findings and recommendations between the title page and the
terms of reference. This is quite common and useful in report writing.

Above all, it is important that you structure a report to achieve the following:

The report should, as far as possible, be interesting

The report should be easy to understand
The report should follow a logical sequence, leading the reader along a particular path.

5. Presentation
Presentation is crucial for a report to be well received. Each page must be well laid out to appeal to
the readers eye
The use of white space, headings and sub-headings, indentations and report numbering systems
should be applied to create maximum impact.