From the Shadows

Is there a proper role for linear programming in corporate strategic planning; if so, what is it?

Planners and executives generally believe that strategic planning involves too many essential factors that are subjective, uncontrollable, uncertain, and non-quantifiable to be amenable to quantitative analysis, in general, and to optimization methods, in particular. That belief needs to be re-examined.

Consultants (like Nature) abhor a vacuum, even a conceptual one. So, over the last decade or so, a number of analytical tools have been developed and applied to corporate strategic planning: the growth-share matrix, the GE-McKinsey screen, PIMS, the “experience curve,” and others. The “portfolio analysis” approach embodied in these tools has swept the field, even as optimization has in tactical and operations planning.