From Mission to Moves
Planning converts intention into commitments. The hierarchy runs downhill from identity to calendar: Mission (why we exist), Vision (destination photo), Objectives (milestones), Strategies (routes), and Plans & budgets.
Well-formed objectives are SMART: specific, measurable, achievable, relevant, time-bound. SWOT scans internal Strengths and Weaknesses, and external Opportunities and Threats. Value lives in crossings: strengths aimed at opportunities (attack), weaknesses exposed to threats (defend).
| Level | Question | Horizon |
|---|---|---|
| Mission | Why do we exist? | Permanent |
| Objectives | Which milestones? | Quarters |
| Strategies | Which route? | Path |
Porter's generic strategies ask why customers pick us: Cost leadership (same value, lower cost), Differentiation (premium value), and Focus (niche). Firms refusing to choose are stuck in the middle.
The Experience Curve
The experience curve states every doubling of cumulative output cuts unit cost by a constant percentage (typically 15-25%).
Where is cumulative units ever produced. An 80% curve leaves costs at 80% per doubling: unit 1 at 100%, 2 at 80%, 4 at 64%, 8 at 51.2%, 16 at 41%.
| Cumulative units | Unit cost (% of first) |
|---|---|
| 1 | 100% |
| 2 | 80% |
| 4 | 64% |
Pitfall: Plotting against annual volume. The x-axis is cumulative output ever produced. First movers compound advantages, but disruption resets the curve.