In strategic planning,management develops a mission and long-term objectives and determines in advance how they will be accomplished. Long-term generally means longer than 1 year. In operational planning, management sets short-term objectives and determines in advance how they will be accomplished. Short-term objectives are those that can be met in 1 year or less. Much of team management is evolving from a focus on winning as a means of realizing short-term profits to a focus on strategic management of the team brand as a means of realizing long-term appreciation in franchise value.
Strategic planning and operational planning differ primarily by time frame and by the management level involved. Strategic plans are typically developed for 5 years and are reviewed and revised every year so that a 5-year plan is always in place. Top-level managers develop strategic plans. Operational plans are developed for time frames of 1 year or less; middle managers or first-line managers develop operational plans.
The strategic process is about developing both the long-range and short-range plans that will enable the organization to accomplish its long-range objectives. If we use the means and ends analysis (chapter 2), top managers determine the ends, and middle- and lower-level managers find the means to accomplish the ends. Hosting major sport events requires long-term strategic plans that are well coordinated with short-term plans. The investments must fit into the city’s long-term plan to make the event economically successful.8 The Olympic Games require extensive long- and short-term planning by the IOC and the cooperation of the host country and city.9
In the strategic process, managers (1) develop the mission, (2) analyze the environment, (3) set objectives, (4) develop strategies, and (5) implement and control the strategies. Developing strategies takes place at three levels. As you can see from figure 4.1, the process is not a linear one. Managers continually return to previous steps and make changes—planning is an ongoing process. Also note that management performs the four management functions—planning, organizing, leading, and controlling—in the strategic
Levels of Strategies
An organization’s strategy is its plan for pursuing its mission and achieving its objectives. The three levels of strategies are corporate, business, and functional. We examine these three levels in more detail later in this chapter. Here we simply define them to give you an overview.
Corporate-level strategy is the organization’s plan for managing multiple lines of businesses. Many large companies are actually several businesses. Adidas, for example, sells footwear, golf equipment, and cycling products—the company treats each product line as a separate line of business.
Adidas has been implementing its corporate-level strategy by entering new markets via key acquisitions. In 2011, as part of its Strategic Business Plan Route 2015, Adidas acquired Five Ten, a leading performance brand in outdoor action sports. “We are very excited to join forces with Five Ten. Five Ten is a leading brand in the technical outdoor market and within the outdoor action sport community. Climbers, mountain bikers and other outdoor athletes around the world highly value their products,” said Rolf Reinschmidt, Senior Vice President adidas Outdoor.10
Business-level strategy is the organization’s plan for managing one line of business. Each of Adidas’ businesses has its own strategy for competing in its market. In golf, “TaylorMade-adidas Golf’s aim is to be the leading performance golf company in the world in terms of sales and profitability. It combines three of golf’s best-known and respected brands: TaylorMade, adidas Golf and Ashworth.” TaylorMade is the market leader in the metalwoods category, adidas Golf develops high-performance footwear and apparel, and Ashworth is an authentic golf-inspired lifestyle brand complementing adidas Golf’s position.11
Functional-level strategy is the organization’s plan for managing one area of the business. Functional areas include marketing, finance and accounting, operations and production, human resources, and others depending on the specific line of business. Managers in each of Adidas’ business lines are involved with these functional areas. For example, TaylorMade-adidas Golf has combined product marketing, brand communication, and retail marketing into one fully integrated global marketing team. It has used Twitter and Facebook to make sure TaylorMade-adidas Golf reaches the social media generation.12 Figure 4.2 shows the relationships among corporate-, business-, and functional-level
Development of the Mission
Developing the organization’s mission is the first step in the strategic process. The mission provides the foundation on which the plan, via the four remaining steps, will be constructed. The organization’s mission, as noted in chapter 2, defines who the organization is and why it exists. The mission describes management’s vision (which may be a separate statement) for the company—where the company is headed and why. FIFA’s mission is stated as “Develop the game, touch the world, build a better future.” “We see it as our mission to contribute towards building a better future for the world by using the power and popularity of football. This mission gives meaning and direction to each and every activity that FIFA is involved in—football being an integrated part of our society.”13
The field of sport management is monitored by the North American Society for Sport Management (NASSM). NASSM’s mission is to actively be involved in supporting and assisting professionals working in the fields of sport, leisure, and recreation. The purpose of NASSM is to promote, stimulate, and encourage study, research, scholarly writing, and professional development in the area of sport management—both theoretical and applied aspects.14 NASSM membership has increased significantly over the years, which is a sign that it is achieving its mission of helping members interested in sport management. NASSM has a strategic plan, which its members continue to discuss and update.