Planning premises/assumptions are established early on in the strategic planning process and act as a basis for formulating strategies.
"Premise control has been designed to check systematically and continuously whether or not the premises set during the planning and implementation process are still valid.
It involves the checking of environmental conditions. Premises are primarily concerned with two types of factors:
- Environmental factors (for example, inflation, technology, interest rates, regulation, and demographic/social changes).
- Industry factors (for example, competitors, suppliers, substitutes, and barriers to entry).
All premises may not require the same amount of control. Therefore, managers must select those premises and variables that (a)are likely to change and (b) would a major impact on the company and its strategy if the did.