TJX Companies Headquartered in Framingham, Massachusetts, tJX Companies is a dis

Question

TJX Companies

Headquartered in Framingham, Massachusetts, tJX Companies is a discount apparel and home fashions retailer in the united States and abroad the company owns t. J. Maxx, Marmaxx, Home goods, tJX Canada, tJX europe, and Sierra trading Post it operates about 1,100 t. J. Maxx stores, 950 Marshalls, 450 Home goods, and 4 Sierra trading Posts in the united States alone. tJX’s annual sales of nearly $30 billion are up 50 percent over the past 6 years and company profits have tripled to over $2.1 billion regarding its corporate strategic planning and evaluating process, tJX is one of the most secretive of all publically held retailers as discussed in this chapter, there are numerous advantages and disadvantages of being secretive rather than open in revealing corporate strategy. tJX’s Ceo, Carol Meyrowitz, as well as her top executives, rarely give interviews and never discuss corporate strategy. tJX does not talk about its corporate strategy in part because rival firms are eager to learn this information in order to duplicate, imitate, undermine, and replicate. However, recent research by Fortune reveals that “excellent inventory control” is a secret to the strategic success of tJX, including the following practices:

1. turn inventory over quickly according to Morningstar, tJX turns over inventory every 55 days, versus 85 days for its peer group. tJX is structured to buy quickly and sell merchandise the company shipped about 2 billion units to its stores in its 2014 fiscal year (which ended on February 1), up from 1.6 billion in fiscal 2010 oftentimes, merchandise is sold before tJX has paid its vendors. Quick inventory turnover keeps new merchandise on the floor so customers rarely see the same items on repeat visits. tJX trains employees to “buy when you see it; otherwise it will be gone.”

2. Provide “value, trendy merchandise,” not “cheap, leftover merchandise.”

3. Promote the “treasure hunt” experience rather than catering to lower-income customers even high-income customers love the treasure hunt experience in tJX stores.

4. train buyers extensively and then give buyers autonomy to negotiate millions of dollars of purchases from suppliers. Purchase inventory year-round, continuously rather than seasonally, and purchase as close to the time of need as possible to negotiate a better price and be assured of the latest fashion trend negotiate low prices for purchases even if it means oftentimes purchasing “all available items in a category.”

Despite performing considerably better than it rival firms, tJX faces heightened competition in the off-price retail industry. For example, nordstrom (JWn) is rapidly expanding its rack stores, opening 27 off-price new stores in 2016. Macy’s (M) opened four pilot off-price stores in fall 2015, and neiman Marcus, Saks, and ross Stores (roSt) are boosting their presence in off-price retailing.

Questions

1. What are the advantages and disadvantages of keeping the strategic-planning process secret versus placing the firm’s strategic plan on the corporate website and discussing strategies and planning publically?

2. What are three types of industries where secrecy is warranted and three industries where secrecy is not warranted, or does type of industry even matter?

3. Many colleges and universities have their strategic plan posted on their website. What are the advantages and disadvantages of this practice?

4. Rank order the four “secret” practices listed in terms of how important you think the items are to tJX’s overall success. Rank the four items from 1 = most important to 4 = least important.

Explanation / Answer

Ans:

The value of formal strategic planning

Some top managers of organizations that use formal corporate strategic planning seem to believe that it helps improve the long-term performance of their organizations.

However among many academic researchers opinion seems divided. Over many years research results seem to be in conflict. Some claim a link between formal planning and business performance. Others claim there is no link, while others show inconclusive findings.

There seems to be very little clear research on any link between the formality of the strategic planning process and overall organizational performance among non-profit organizations.

My own view is that there are benefits from systematic strategic planning. I believe most of the confusion about this arises from differences in measures used for measuring corporate performance and the nature of the processes called strategic planning.

Describing strategic planning

For our purposes, we think of formal corporate strategic planning as a label to describe an organizational managerial process.

I define strategic planning as a set of procedures for -

setting long-range quantified overall corporate objectives and of

determining the strategies, and

assigning accountabilities, within policies that govern the acquisition and allocation of resources

to achieve the fundamental purpose of the organization.

Strategic planning has also been known under various labels encompassing “long-range planning”, “corporate planning”, and even equated with “strategic management”.

When the term formal strategic planning is used the intent is to convey that an organization’s strategic planning process involves explicit systematic procedures used to gain the involvement and commitment of those principal stakeholders affected by the plan, and in particular the beneficiaries for whose benefit the organization exists.

It is not the purpose of this section of simply-strategic-planning.com to analyze all the variations in terminology used to describe strategic planning. The distinctions between strategic planning and other forms of planning with which it is sometimes confused

What do we mean by formal?

By 'formal' I the extent to which roles in, or contributions to, corporate strategic planning is structured in the organization of the planning process. Additionally, the activities of the persons involved are governed by explicit procedures. These activities are primarily data focused discussions that lead to the taking of strategic decisions.

These deliberations are informed by evidence gathered and analyzed in preparation for and during the planning process.

The amount of data required to feed the process of strategic thinking is a lot less than most managers believe.

You need to collect only three types of data -

The corporate objectives and targets.

Strengths and weakness of the organization.

Threats and opportunities in its outside environment.

Collect these, lay them out clearly before you, discuss their importance for the future performance of the organization, and the strategic possibilities will emerge with almost crystal clarity.

The resulting handful of strategies must then be developed into detailed action plans and business plans but these are executive tasks, which follow on from the planning process.

Advantages of formal procedures for planning

Strategic planning is essentially a decision making process. Our experience is that strategic planning as a group decision-making process benefits greatly from formalizing of the procedures involved.

Unstructured or freewheeling approaches are highly regarded in some organizations; however, when the process of strategic planning is involved such free-form approaches can suffer from certain disadvantages.

The purpose of a number of the procedures of formal strategic planning is to reduce these problems while making the gains possible with group decision making.

Formal strategic planning procedures can challenge the complacent acceptance of the status quo

Free discussion can be comfortable because it is the way groups routinely decide things on a day to day basis. Overly formal or highly structured discussions are perceived as unusual or going against the grain of the normal way people interact.

While this may difficult initially, I believe the requisite procedures can get planning team members out of habitual ways of reacting to issues and sloppy ways of addressing issues important to the organization... Being forced to act out of their ‘comfort zone’ can make educe clearer and more creative thinking that is common in a ‘business as usual’ setting.

Formal strategic planning procedures can ensure top managers are on the same page!

n most organizations top managers are aware in some way of major challenges facing the organization that they should address. Often they deal with them in ad hoc discussions with colleagues. However, all the people, who need to be involved, are not usually available. All are usually heavily pressed with many days to day operational matters. Withdrawing from all this to discuss longer-range matters, seems almost like a distraction from their ‘real jobs’. However, the importance of the strategic issues places them in a bit of a conflict. Formal strategic planning gives a legitimacy to setting aside time for deliberating on these larger long-range challenges.

Formalizing strategic planning is more likely to result in top managers paying attention to the same important matters at the same time

Even if it is agreed that time be specifically designated for strategic planning, if the planning is not formalized, with the clear structure to the process the discussions can revert to the usual freewheeling talking that characterizes much of their informal daily interactions. Some will even drag the alleged strategic discussion back to operational concerns.

In unstructured planning discussions, coordinating activities may be a problem. One manager may be trying to clarify a statement of an issue, while a second planning team member is jumping to a strategy to address it, and yet another is trying to assess ideas raised earlier in the deliberations! In contrast, formal strategic planning procedures make it clear to planning process participants what they should be thinking about at stages of the discussion. This increases the chances that management will be singing from the same page at least, even if, initially they are quite in harmony on the issue.

Without the structure that comes with formal strategic planning, contributions may become unbalanced

Formal strategic planning procedures can reduce the effects of a few over-enthusiastic planning process participants trying to dominate the process with their own views, without getting to properly consider the views of others.

Without the procedures of formal strategic planning, a minority of participants in the strategic planning discussions can tend to dominate proceedings. This problem can be exacerbated in the larger workshop settings that I believe are vital for the SWOT analysis stage of the strategic planning process.

In these larger group settings, some less extrovert participants can feel excluded, and the group may miss the benefit of their insights. However, formal strategic procedures, guided by a skilled facilitator, can control the discussion to ensure that everyone can make a contribution. Additionally, you reduce the likelihood that a few dominant people will hijack the deliberations.

This raises a related matter, and one that requires the structure provided by formal procedures for planning. This is the issue of the way power is deployed in a group setting.

The procedures of formal strategic planning can moderate the use of power in a planning group

Powerful members of a senior management team, or among participants in planning workshops, can use the informality of unstructured planning processes for their own ambitions. This is less likely under the moderating influence of formal strategic planning procedures, especially when guided by an experienced, independent and skilled facilitator.

This issue of power in the planning group is not only about the exercise of formal authority associated with the most senior management roles. Some less senior managers, sometimes with ‘hidden agendas’ and strong political skills, can steer the planning discussions in directions that suit their ambitions. This can be done by means of informally exercising influence. Well designed guidelines employed in a systematic and formal strategic planning process make it more difficult for powerful members to unduly influence what happens during the course of the strategic planning deliberations.

This leads us to the consideration of possible conflicts among participants in the planning process.

Disadvantages:

1)It is both costly and time-consuming

2)It is prescriptive in nature

3)There is excessive formalization in the process

4)Lack of flexibility

5)Loss of initiative to enterprising firms

6)Lack of realism

2Answer:

a) All correspondence in connection with this part, including petitions, should be addressed to Mail Stop L&R, Commissioner for Patents, P.O. Box 1450, Alexandria, Virginia 22313-1450.

(b) Definitions.

(1) Application as used in this part includes provisional applications (§ 1.9(a)(2) of this chapter), nonprovisional applications (§ 1.9(a)(3)), international applications (§ 1.9(b)), or international design applications (§ 1.9(n)).

(2) Foreign application as used in this part includes, for filing in a foreign country, foreign patent office, foreign patent agency, or international agency (other than the United States Patent and Trademark Office acting as a Receiving Office for international applications (35 U.S.C. 361, §1.412) or as an office of indirect filing for international design applications (35 U.S.C. 382, § 1.1002)) any of the following: An application for patent, international application, international design application, or application for the registration of a utility model, industrial design, or model.

(c) Patent applications and documents relating thereto that are national security classified (see § 1.9(i) of this chapter) and contain authorized national security markings (e.g., “Confidential,” “Secret” or “Top Secret”) are accepted by the Office. National security classified documents filed in the Office must be either hand-carried to Licensing and Review or mailed to the Office in compliance with paragraph (a) of this section.

(d) The applicant in a national security classified patent application must obtain a secrecy order pursuant to § 5.2(a). If a national security classified patent application is filed without a notification pursuant to § 5.2(a), the Office will set a time period within which either the application must be declassified, or the application must be placed under a secrecy order pursuant to § 5.2(a), or the applicant must submit evidence of a good faith effort to obtain a secrecy order pursuant to § 5.2(a)from the relevant department or agency in order to prevent abandonment of the application. If evidence of a good faith effort to obtain a secrecy order pursuant to § 5.2(a) from the relevant department or agency is submitted by the applicant within the time period set by the Office, but the application has not been declassified or placed under a secrecy order pursuant to § 5.2(a), the Office will again set a time period within which either the application must be declassified, or the application must be placed under a secrecy order pursuant to § 5.2(a), or the applicant must submit evidence of a good faith effort to again obtain a secrecy order pursuant to § 5.2(a) from the relevant department or agency in order to prevent abandonment of the application.

(e) An application will not be published under § 1.211 of this chapter or allowed under § 1.311 of this chapter if publication or disclosure of the application would be detrimental to national security. An application under national security review will not be published at least until six months from its filing date or three months from the date the application was referred to a defense agency, whichever is later. A national security classified patent application will not be published under § 1.211 of this chapter or allowed under § 1.311 of this chapter until the application is declassified and any secrecy order under § 5.2(a) has been rescinded.

(f) Applications on inventions made outside the United States and on inventions in which a U.S. Government defense agency has a property interest will not be made available to defense agencies.

37 CFR 5.2 Secrecy order.

(a) When notified by the chief officer of a defense agency that publication or disclosure of the invention by the granting of a patent would be detrimental to the national security, an order that the invention is kept secret will be issued by the Commissioner for Patents.

(b) Any request for compensation as provided in 35 U.S.C. 183 must not be made to the Patent and Trademark Office, but directly to the department or agency which caused the secrecy order to be issued.

(c) An application disclosing any significant part of the subject matter of an application under a secrecy order pursuant to paragraph (a) of this section also falls within the scope of such secrecy order. Any such application that is pending before the Office must be promptly brought to the attention of Licensing and Review unless such application is itself under a secrecy order pursuant to paragraph (a) of this section. Any subsequently filed the application containing any significant part of the subject matter of an application under a secrecy order pursuant to paragraph (a) of this section must either be hand-carried to Licensing and Review or mailed to the Office in compliance with § 5.1(a).

37 CFR 5.3 Prosecution of application under secrecy orders; withholding patent.

Unless specifically ordered otherwise, action on the application by the Office and prosecution by the applicant will proceed during the time an application is under secrecy order to the point indicated in this section:

(a) National applications under secrecy order which come to a final rejection must be appealed or otherwise prosecuted to avoid abandonment. Appeals in such cases must be completed by the applicant but unless otherwise specifically ordered by the Commissioner for Patents will not be set for hearing until the secrecy order is removed.

(b) An interference or derivation will not be instituted involving a national application under secrecy order. An applicant whose application is under secrecy order may suggest an interference (§ 41.202(a) of this title), but the Office will not act on the request while the application remains under a secrecy order.

(c) When the national application is found to be in condition for allowance except for the secrecy order the applicant and the agency which caused the secrecy order to be issued will be notified. This notice (which is not a notice of allowance under § 1.311 of this chapter) does not require reply by the applicant and places the national application in a condition of suspension until the secrecy order is removed. When the secrecy order is removed the Patent and Trademark Office will issue a notice of allowance under § 1.311 of this chapter or take such other action as may then be warranted.

(d) International applications and international design applications under secrecy order will not be mailed, delivered, or otherwise transmitted to the international authorities or the applicant. International applications under secrecy order will be processed up to the point where, if it were not for the secrecy order, record and search copies would be transmitted to the international authorities or the applicant.

37 CFR 5.4 Petition for rescission of secrecy order.

(a) A petition for rescission or removal of a secrecy order may be filed by, or on behalf of, any principal affected thereby. Such petition may be in letter form, and it must be in duplicate.

(b) The petition must recite any and all facts that purport to render the order ineffectual or futile if this is the basis of the petition. When prior publications or patents are alleged the petition must give complete data as to such publications or patents and should be accompanied by copies thereof.

(c) The petition must identify any contract between the Government and any of the principals under which the subject matter of the application or any significant part thereof was developed or to which the subject matter is otherwise related. If there is no such contract, the petition must so state.

(d) Appeal to the Secretary of Commerce, as provided by 35 U.S.C. 181, from a secrecy order, cannot be taken until after a petition for rescission of the secrecy order has been made and denied. An appeal must be taken within sixty days from the date of the denial, and the party appealing, as well as the department or agency which caused the order to be issued, will be notified of the time and place of a hearing.

37 CFR 5.5 Permit to disclose or modification of secrecy order.

(a) Consent to disclosure, or to the filing of an application abroad, as provided in 35 U.S.C. 182, shall be made by a “permit” or “modification” of the secrecy order.

(b) Petitions for a permit or modification must fully recite the reason or purpose for the proposed disclosure. Where any proposed disclosure is known to be cleared by a defense agency to receive classified information, the adequate explanation of such clearance should be made in the petition including the name of the agency or department granting the clearance and the date and degree thereof. The petition must be filed in duplicate.

(c) In a petition for modification of a secrecy order to permit filing abroad, all countries in which it is proposed to file must be made known, as well as all attorneys, agents, and others to whom the material will be consigned prior to being lodged in the foreign patent office. The petition should include a statement vouching for the loyalty and integrity of the proposed discloses and where their clearance status in this or the foreign country is known all details should be given.

(d) Consent to the disclosure of subject matter from one application under secrecy order may be deemed to be consent to the disclosure of common subject matter in other applications under secrecy order so long as not taken out of context in a manner disclosing material beyond the modification granted in the first application.

(e) Organizations requiring consent for disclosure of applications under secrecy order to persons or organizations in connection with repeated routine operation may petition for such consent in the form of a general permit. To be successful such petitions must ordinarily recite the security clearance status of the disclosed as sufficient for the highest classification of material that may be involved.

I.SECRECY ORDER TYPES

Three types of Secrecy Orders, each of a different scope, are issued as follows:

(A) Secrecy Order and Permit for Foreign Filing in Certain Countries (Type I secrecy order)— to be used for those patent applications that disclose critical technology with military or space application in accordance with DoD Directive 5230.25 “Withholding of Unclassified Technical Data From Public Disclosure,” based on 10 U.S.C. 130 “Authority to Withhold From Public Disclosure Certain Technical Data.”

(B) Secrecy Order and Permit for Disclosing Classified Information (Type II secrecy order)— to be used for those patent applications which contain data that is properly classified or classifiable under a security guideline where the patent application owner has a current DoD Security Agreement, DD Form 441. If the application is classifiable, this secrecy order allows disclosure of the technical information as if it were classified as prescribed in the National Industrial Security Program Operating Manual (NISPOM).

(C) General Secrecy Order (Type III secrecy order)— to be used for those patent applications that contain data deemed detrimental to national security if published or disclosed, including that data properly classifiable under a security guideline where the patent application owner does not have a DoD Security Agreement. The order prevents disclosure of the subject matter to anyone without an express written consent from the Commissioner for Patents. However, quite often this type of secrecy order includes a permit “Permit A” which relaxes the disclosure restrictions as set forth in the permit.

The Type I Secrecy Order is intended to permit the widest utilization of the technical data in the patent application while still controlling any publication or disclosure which would result in an unlawful exportation. This type of Secrecy Order also identifies the countries where corresponding patent applications may be filed. Countries with which the United States has reciprocal security agreements are Australia, Belgium, Canada, Denmark, France, Germany, Greece, Italy, Japan, Luxembourg, Netherlands, Norway, Portugal, Republic of Korea, Spain, Sweden, Turkey and the United Kingdom. Please note that applications subject to a secrecy order cannot be filed directly with the European Patent Office since no reciprocal security agreement with this organization exists. Applications must be filed in the individual EPO member countries identified above. Applicant must arrange to file of such subject matter through the agency sponsoring the secrecy order.

The intent of the Type II Secrecy Order is to treat classified and classifiable technical data presented as a patent application in the same manner as any other classified material. Accordingly, this Secrecy Order will include a notification of the classification level of the technical data in the application.

The Type III Secrecy Order is used where the other types of Orders do not apply, including Orders issued by direction of agencies other than the Department of Defense.

A Secrecy Order should not be construed in any way to mean that the Government has adopted or contemplates adoption of the alleged invention disclosed in an application; nor is it any indication of the value of such invention.

II.RELATED SUBJECT MATTER

The Secrecy Orders apply to the subject matter of the invention, not just to the patent application itself. Thus, the Secrecy Order restricts disclosure or publication of the invention in any form. Furthermore, other patent applications already filed or later filed which contain any significant part of the subject matter of the application also fall within the scope of the Order and must be brought to the attention of Licensing & Review if such applications are not already under Secrecy Order by the Commissioner.

The effects of a Secrecy Order are detailed in the notifying letter and include restrictions on disclosure of the invention and delay of any patent grant until the Order is rescinded.

III.CORRESPONDENCE

When the Secrecy Order issues, the law specifies that the subject matter or any material information relevant to the application, including unpublished details of the invention, shall not be published or disclosed to any person not aware of the invention prior to the date of the Order, including any employee of the principals except as permitted by the Secrecy Order. The law also requires that all information material to the subject matter of the application be kept in confidence unless written permission to disclose is first obtained from the Commissioner for Patents except as provided by the Secrecy Order. Therefore, all correspondence to be filed in an application which is subject to a secrecy order and which is directly related to the subject matter covered by the Secrecy Order must be transmitted to the Office in a manner which would preclude disclosure to unauthorized individuals and addressed as set forth in 37 CFR 5.1(a). Use of facsimile transmission is not permitted. 37 CFR 1.6(d)(6).

Subject matter under Secrecy Order must be safeguarded under conditions that will provide adequate protection and prevent access by unauthorized persons.

When applicants desire to change the Power of Attorney in an application under Secrecy Order, an applicant is required to provide a statement that the new attorney(s) has been apprised of the secrecy order.

In the case of applications bearing National Security Classification markings pursuant to an Executive Order, e.g., “Confidential” or “Secret,” applicants must provide a DoD cage code as evidence of the ability to accept and store classified information. Applicants no longer need to provide individual personal information to ensure a proper security clearance. Personnel controlling the cleared correspondence address bear the burden of ensuring that individuals obtaining classified information from the correspondence address follow the proper procedures for handling classified information.

IV.INTERNATIONAL APPLICATIONS (PCT) AND INTERNATIONAL DESIGN APPLICATIONS

If the Secrecy Order is applied to an international application or an international design application, the application will not be mailed, delivered, or otherwise transmitted to the international authorities or the applicant as long as the Secrecy Order remains in effect.

An international application will be considered withdrawn (abandoned) if the Secrecy Order remains in effect at the end of the time limit under PCT Rule 22.3 because the Record Copy of the international application was not received in time by the International Bureau. 37 CFR 5.3(d), PCT Article 12(3), and PCT Rule 22.3. If the United States of America has been designated, however, it is possible to save the U.S. filing date, by fulfilling the requirements of 35 U.S.C. 371(c)prior to the withdrawal.

V.CHANGES IN SECRECY ORDERS

Applicants may petition for rescission or modification of the Secrecy Order. For example, if the applicant believes that certain existing facts or circumstances would render the Secrecy Order ineffectual, he or she may informally contact the sponsoring agency to discuss these facts or formally petition the Commissioner for Patents to rescind the Order. Rescission of a Secrecy Order may also be effected in some circumstances by expunging the sensitive subject matter from the disclosure, provided the sensitive subject matter is not necessary for an enabling disclosure under 35 U.S.C. 112. See MPEP § 724.05. The defense agency identified with the Secrecy Order as sponsoring the Order should be contacted directly for assistance in determining what subject matter in the application is sensitive, and whether the agency would agree to rescind the Order upon expunging this subject matter. The applicant may also petition the Commissioner for Patents for a permit to disclose the invention to another or to modify the Secrecy Order stating fully the reason or purpose for disclosure or modification. An example of such a situation would be a request to file the application in a foreign country. The requirements for petitions are described in 37 CFR 5.4 and 5.5. The law also provides that if an appeal is necessary, it may be taken to the Secretary of Commerce. Any petition or appeal should be addressed to the Mail Stop L&R, Commissioner for Patents, P.O. Box 1450, Alexandria, Virginia, 22313-1450.

VI.IMPROPER OR INADVERTENT DISCLOSURE

If prior to or after the issuance of the Secrecy Order, any significant part of the subject matter or material information relevant to the application has been or is revealed to any U.S. citizen in the United States, the principals must promptly inform such person of the Secrecy Order and the penalties for improper disclosure. If such part of the subject matter was or is disclosed to any person in a foreign country or foreign national in the U.S., the principals must not inform such person of the Secrecy Order, but instead must promptly furnish to Mail Stop L&R, Commissioner for Patents, P.O. Box 1450, Alexandria, Virginia, 22313-1450 the following information to the extent not already furnished: date of disclosure; name and address of the disclosure; identification of such subject matter; and any authorization by a U.S. government agency to export such subject matter. If the subject matter is included in any foreign patent application or patent, this should be identified.

VII.EXPIRATION

Under the provision of 35 U.S.C. 181, a Secrecy Order remains in effect for a period of 1 year from its date of issuance. A Secrecy Order may be renewed for additional periods of not more than 1 year upon notice by a government agency that the national interest so requires. The applicant is notified of any such renewal.

The expiration of or failure to renew a Secrecy Order does not lessen in any way the responsibility of the principals for the security of the subject matter if it is subject to the provisions of Exec. Order No. 12958 or the Atomic Energy Act of 1954, as amended, 42 U.S.C. 141 et. seq. and 42 U.S.C. 2181 et. seq. or other applicable law unless the principals have been expressly notified that the subject patent application has been declassified by the proper authorities and the security markings have been authorized to be canceled or removed.

3Answer:

Universities are driven to engage in a strategic planning process by a variety of forces. These include increasing demand for higher education concurrent with a decline in government funding, changing student demographics, and a need to compete with the emerging models of higher education while keeping the essence of a traditional comprehensive university. A strategic planning process can help prepare a university to face these emerging challenges. According to Benjamin & Carroll (1998, p.3), “if current trends continue, more than one-third of the Californians seeking to enroll in ”a state university “will be unable to do so by the year 2015.” Consequently, to avoid such outcomes, universities need to “make major structural changes in their decision-making systems … and reallocate scarce resources” (Benjamin & Carroll, 1998, p.21). Universities should also “pursue greater mission differentiation to streamline their services and better respond to the changing needs of their constituencies” (Benjamin & Carroll, 1998, p. 22-23). Strategic planning can aid the university in accomplishing these tasks. CHALLENGES FACING CALIFORNIA HIGHER EDUCATION Recent years have brought many changes to the landscape of California’s higher education. Following is a brief description of these challenges.

A decrease in state government funding Public universities’ share of the state budget is plummeting; according to David Breneman, it will decline to 1% in 2002 (from 12% in 1994). At the same time, according to Benjamin & Carroll (1998), the operating costs per student in higher education are rising. Increase in demand for higher education Demand for higher education is expected to increase sharply in the next decade. According to former CSU Chancellor Barry Munitz, university enrollment in California will increase to 2.7 million in 2010, a 50% increase over 1.8 million in 1994. For CSU, this translates into an additional 100,000 full-time equivalent students (FTE) annually by 2010 (Cornerstones, appendix, p.2). In addition to the expected population growth, the proportion of the population that will attend universities will increase. According to Benjamin & Carroll (1998, p. 9), “only college graduates will be able to hold their own economically” by 2015. As more and more people recognize that a college degree is essential to their economic well being, demand for higher education will increase. Changing demographics Students’ demographic makeup is changing. As the number of Latino and Asian students increases over the next decade, the universities will not have a single racial “majority” group. By 2005 about half of the entering class of students will come from non-“Anglo-white” families. In addition, the average age of the student population will increase, as more “older” students return to universities to get undergraduate degrees. Seeking “the best conditions for the success of all its diverse students,” universities need to provide education that will allow graduates to “fully participate in a diverse society committed to democratic values” (Cornerstones, appendix, p 3). New models of higher education New models of providing higher education have emerged in recent years. According to some researchers, a gap between what the public wants and what traditional universities provide is growing (Rowley, Lujan, & Dolence, 1997). Changes in the educational needs (i.e. a need for more specific, applied education), unmet by the existing system of higher education, have prompted the emergence of for-profit, “conveniences” universities, such as the University of Phoenix and National University. Adapting to the needs of the consumer-driven market (Traub, 1997), they view the student as a customer, target specific functions (based on the market need), and offer schedules convenient for students. Thus “traditional” universities must find ways to deal with this new competition. Keeping elements of a “traditional” model “Universities can’t move completely away from a provider-driven model to a consumer driven form of higher education. … The quest for new knowledge, the analysis of theories and practices, and the free exchange of ideas would suffer if colleges and universities only offered what was popular” (Rowley, Lujan, & Dolence, 1997, p. 54). Eliminating disciplines because they are currently not in demand is contrary to the mission of a comprehensive university. Yet to some degree all campuses must consider student preferences for applied education and the larger labor market.

4Answer:

For items 1 to 4 listed in the mini-case, the ranking is 4-3-1-2, so training buyers and giving them autonomy is most important, whereas providing value and trendy merchandise is least important.

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