Why are contingency strategies important?
A strategy is defined as the determination of the basic long term objectives of an enterprise and the adoption of courses of action and allocation of resources necessary to achieve these goals. Today most business enterprise engages in strategic planning, although the degree of sophistication and formality vary considerably. Conceptually, strategic planning is deceptively simple; analyze the current and expected future situation, determine the direction of the firm, and develop means for achieving the missions. Planning is done in an environment of uncertainty. No one can be sure what the external as well as the internal environment will be in the next week, much less several years from now. Therefore people make assumption, or forecast about the anticipated environment. Some of the forecast become assumptions for other plans. For example the gross national product forecast becomes the assumption for sales planning, which in turns becomes the basis for production planning, and so on. T
