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The strategic planning process is inextricably linked with the issue of corporate goal formulation. It is argued that greater progress will be made in understanding marketing's participation in strategic planning if marketing's role in the goal formulation process can be explicated. Unfortunately, the extant theories of the firm are inadequate in varying degrees for this purpose. A new theory of the firm is proposed that attempts to specify the role of marketing and the other functional areas in the goal setting and strategic planning process.

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