Corporate Planning vs Strategic Planning
In the surface level, strategic planning and corporate planning are interrelated though, there is difference between corporate planning and strategic planning in the sense that strategic planning refers to the larger extent when compared to the corporate planning. In simple, the strategic planning relates to the entire company, and the corporate planning relates to the specific functions of the company. Therefore, the corporate planning is less in extent. Furthermore, the strategic planning determines the overall direction of the company while the corporate planning determines and function on the foundations of the business. Also, the strategic planning says how to exist in the volatile business environments and it emphasizes ways and means of obtaining the competitive advantages over the competitors. In the mean time, the corporate planning helps to determine the internal functions and issues in the company. Interconnecting these two, the strategy is a definite part of corporate planning and the corporate plan incorporates the strategic related issues.
What is Corporate Planning?
Corporations are entities that are designed around a certain set of elements that determines the shape of a business. Among them, the core of the business is important. This refers to the major business activity. For an instance, it can be either producing a product, delivering a service, or a conjunction between the two. Depending on the product or the service the company produces, there is a set of buyers known as the target audience. So, all these elements are managed by the corporate plan of the company. Also, the corporate planning involves functioning the company as well. In this regard, determining the number of units of the company and assigning people to those units (i.e. departments) depending on their capabilities are also addressed under corporate planning. Therefore, almost all the internal functionality is handled by the corporate plan.
What is Strategic Planning?
By having a strategy plan, it is expected to determine a long-term direction of a company. Also, the competitive edge of the company is achieved by executing the strategy. Therefore, gaining competitive advantage is also addressed in this regard. These facts depict that strategic plan always address the entire company. Therefore, this involves observing the environment that is really volatile in nature and determining changes accordingly. This scanning aspect requires research and development in the company level. As strategic planning determines the long-term direction of the company, setting mission and vision is also addressed. Allocating resources among different projects in order to achieve the end state of affairs happens in the perspective of strategic planning. There are personnel called strategic managers in a company. They are responsible for scanning the environment and imposing alterations accordingly. This shows that they should possess business intuition.
Some acknowledge the strategic planning as a cycle. Determining the company-wide objectives, and ways and means of achieving the objective is highlighted in this cycle. Once the outcomes are observed, the measurement procedures are also set by the strategic plan. Finally, alterations in the observed results are applied, only if they are needed. Thus, this is acknowledged as a cycle since this a continuous process.
What is the difference between Corporate Planning and Strategic Planning?
• Time Factor:
• Corporate Planning usually comprises of short time periods.
• Strategic planning comparatively comprises of long time periods.
• Corporate planning deals with the internal aspects of the company.
• Strategic planning deals with the overall business (i.e. internal and external) and external environments.
• Corporate planning sets parameters and objectives within the company.
• Strategic planning sets the overall direction of the company.
• Response Nature:
• Corporate planning responds to the market segments which the company deals with.
• Strategic planning selects which market segments to deal with.
• Corporate plans facilitate or help to achieve strategic plans, and corporate plans are set according to the motives of the strategic plan.