File Name: corporate business and functional strategy .zip
Management may draw up several alternative strategic scenarios and appraise them […]. Management may draw up several alternative strategic scenarios and appraise them against the long-term objectives of the organization. To begin implementing the selected strategy or continue a revalidated one , management fleshes it out in terms of the actions to be taken in the near future.
Growth platforms are specifically named initiatives selected by a business organization to fuel revenue and earnings growth. Distinguish between the varying integrations and diversifications that allow businesses to pursue strategic growth.
Growth platforms may be strategic or tactical. Strategic growth platforms are longer-term initiatives for high-scale revenue increases. Generic examples of commonly selected strategic growth platforms include pursuit of specific and new product areas, entry into new distribution channels, vertical or horizontal integration, and new product development.
Illustrative examples of growth platforms include:. Wikipedia growth goals and projections : These graphs show goals and projections for growth for Wikipedia visitors and contributors from The Bridgespan Group for Strategy Development.
The graph in the left panel shows the target growth trajectory in number of visitors, from less than million to over million. The graph in the right panel shows an overall increase in the number of contributors across all Wikipedias, with more growth indicated for the already higher-traffic Wikipedias.
Market penetration occurs when a company penetrates a market in which current products already exist. This strategy generally requires great competitive strength, a strong brand, or both, as most market penetrations demand actively taking market share from current incumbents. It is an aggressive and often risky approach to growth. Market development strategy entails expanding the potential market through new users or new uses for a product.
The strategy is best accomplished through identifying unique niche needs in a specific type of user and filling those needs. Market research is critical in development strategies.
New users can be defined as new geographic segments, new demographic segments, new institutional segments, or new psychographic segments. In business and engineering, new product development NPD is the process of developing, researching, and bringing a new product to market. A product is a set of benefits offered for exchange and can be tangible that is, something physical you can touch or intangible for example, a service, experience, or belief.
Identifying new needs or new ways of filling them and developing a new process or product that accomplishes this aim are the goal of this growth strategy. NPD requires investment in research and development, usually over the long term, and extensive trial and error. In business, consolidation refers to the mergers and acquisitions of many smaller companies into much larger ones for economic benefit. Consolidation or amalgamation is the act of merging two or more organizations into one.
In strategic management, it often refers to the mergers and acquisitions of many smaller companies into much larger ones. Consolidation occurs when two companies combine to form a new enterprise altogether; neither of the previous companies survives independently. The logic driving consolidation is the creation of economies of scale, economies of scope, new locations, new technology, or some other form of increased competitive capacity.
This activity can help an enterprise grow rapidly in its sector or location of origin or expand into a new field or new location. Generally speaking, a merger is a combination of organizations in which each abandons its previous brand and business models, creating a new organization with the combined capacities of each one.
In an acquisition, one organization buys out another, with the acquired company usually placing its processes under the brand name of the acquirer. Mergers and acquisitions of U. Banks : This diagram of bank mergers in the United States shows how extensive the consolidation of various companies has been. What start as more than 50 distinct companies have eventually consolidated into fewer than In the pure sense of the term, a merger happens when two firms, often about the same size, agree to go forward as a single new company rather than remain separately owned and operated.
For example, in the merger of Glaxo Wellcome and SmithKline Beecham, both firms ceased to exist independently; a new company, GlaxoSmithKline, was created. Not every merger with a new name is successful. The following motives are considered to improve financial performance: economy of scale, economy of scope, increased revenue or market share, cross-selling, synergy, taxation, geographical or other diversification, resource transfer, vertical integration, and hiring.
Other motives for merger and acquisition that may not add shareholder value include diversification, manager overconfidence, empire-building, and management compensation. Because of the costs involved, consolidation is a very high-level strategic decision.
All stakeholders in both organizations should be consulted, and agreements will often take many months or years to conclude.
Cultural conflicts between two different organizations are not uncommon, as the mission, vision, and values of the individuals and groups within them are likely to differ.
Managing this type of change strategically is complex and rife with conflict. Mismanagement during these processes can minimize the potential synergistic gains and reduce the efficacy of the new strategic plan. Explain the concept of global strategy within the context of international business and a globalized economy.
How can the organization build the necessary global presence? What are the optimal locations around the world for the various value-chain activities? How can the organization turn a global presence into global competitive advantage?
A global strategy may be appropriate in industries where firms face strong pressures to reduce costs but weak pressures to respond locally; globalization therefore allows these firms to sell a standardized product worldwide. By expanding to a broader consumer base, these firms can take advantage of scale economies cost advantages that an enterprise obtains due to expansion and learning-curve effects because they are able to mass-produce a standard product that can be exported providing that demand is greater than the costs involved.
Globalization is not limited to cost leadership, however. Differentiation strategies also enable economies of scope, either fulfilling different needs in different markets with a similar series of products, or developing new products based upon the needs and consumption habits of a new market. Differentiation as part of a global strategy will often require localization, as organizations must adapt to consumer tastes better to compete in the new country. For example, Coca Cola tastes different depending on the country where it is bought because of differences in local preferences.
Starbucks sources coffee beans from all over the world, as climate dramatically affects the type and quality of the bean. The globalization strategy of Starbucks—while it includes selling in many countries—is hugely depending on global sourcing, and strategic managers must carefully monitor this process for costs and benefits. Global strategies require firms to coordinate tightly their product and pricing strategies across international markets and locations; therefore, firms that pursue a global strategy are typically highly centralized.
With global markets in mind, strategic managers must expand their perspective and use varied models to generate different strategies for different places.
For example, companies must now conduct a PESTEL analysis for each region in which they operate and recognize expense and competition deviations between regions. For example, tariffs in country A may be much higher than country B, but country B has fewer individuals willing to pay a high price for the good the organization is selling. These analyses are how strategists incorporate global concerns into strategic management. Gross domestic product GDP worldwide : The map identifies GDP nominal in different countries;countries with higher GDPs offer high consumer spending opportunities for multinational enterprises.
The U. A strategic alliance is a cooperation where each member expects the benefit from cooperation will outweigh the cost of individual efforts. A strategic alliance is a relationship between two or more parties to pursue a set of agreed-upon goals or to meet a critical business need while remaining independent organizations.
The alliance is a cooperation or collaboration that aims for a synergy where each partner hopes that the benefits from the alliance will be greater than those from individual efforts. Partners may provide the strategic alliance with resources such as products, distribution channels, manufacturing capability, project funding, capital equipment, knowledge, expertise, or intellectual property. The alliance often involves technology transfer access to knowledge and expertise , economic specialization David C.
Mowery, Joanne E. Oxley, Brian S. Strategic Alliances and Interfirm Knowledge Transfer. Winter Strategic Management Journal , Vol. Because the number of patents has increased in recent years, technology transfers in strategic alliances have become more common.
Cooperative sourcing is a collaboration or negotiation between different companies with similar business processes. To save costs, the competitor with the best production capability can insource the business process of the other competitors.
This practice is especially common in IT-oriented industries as a result of low to no variable costs, e. Since all of the negotiating parties can be outsourcers or insourcers, the main challenge in this collaboration is to find a stable coalition and the company with the best production function. High switching costs, costs for searching potential cooperative sourcers, and negotiating may result in inefficient solutions.
Upper management is tasked with the developing complex interactive strategies when entering a strategic alliance. Aligning stakeholders from different businesses and ensuring the costs do not outweigh the benefits requires careful managerial consideration. The following steps highlight key aspects of the strategic alliance process:. In the emerging global economy, e-business has become an increasingly necessary component of business strategy.
The term electronic business commonly referred to as E-business or e-business is sometimes used interchangeably with e-commerce. In fact, e-business encompasses a broader definition that includes not only e-commerce, but customer relationship management CRM , business partnerships, e-learning, and electronic transactions within an organization.
Automated online assistant : In e-commerce, electronic i. Electronic-business methods enable companies to link their internal and external data-processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of customers. In practice, e-business is more than just e-commerce. While e-business refers to a strategic focus with an emphasis on the functions that occur using electronic capabilities, e-commerce is a subset of an overall e-business strategy.
E-business involves business processes that span the entire value chain: electronic purchasing and supply-chain management, electronic order processing, customer service, and business partner collaboration. Special technical standards for e-business facilitate the exchange of data between companies. E-business software allows the integration of intrafirm and interfirm business processes.
E-business can be conducted using the Internet, intranets, extranets, or some combination of these. In the emerging global economy, e-commerce and e-business have become increasingly necessary components of business strategy and strong catalysts for economic development. The integration of information and communications technology ICT in business has revolutionized relationships within organizations and those among organizations and individuals.
The objective of this work is to review the literature of the main concepts that lead to determining the strategic approach, creation of strategies, organizational structures, strategy formulation, and strategic evaluation as a guide for the organizational management, taking into account the effects produced by the different types of strategies on the performance of organizations. In this article, the systemic literature review method was used to synthesize the result of multiple investigations and scientific literature. The process of reading and analysis of the literature was carried out through digital search engines with keywords in areas related to the strategic management. This research reveals the lack of scientific literature containing important theoretical concepts that serve the strategists as a guide in the creation, formulation, and evaluation of strategies. This review contributes to the existing literature by examining the impact of the strategic management on the organizational performance.
Definition : Functional Level Strategy can be defined as the day to day strategy which is formulated to assist in the execution of corporate and business level strategies. These strategies are framed as per the guidelines given by the top level management. Functional Level Strategy is concerned with operational level decision making, called tactical decisions , for various functional areas such as production, marketing, research and development, finance, personnel and so forth.
A strategy is the central, integrated, externally oriented concept of how a firm will achieve its objectives. Strategy formulation The process of deciding what to do; also called strategizing. Neither can succeed without the other; the two processes are interdependent from the standpoint that implementation should provide information that is used to periodically modify the strategy.
This a really important question as planning happens all the time and as this question suggests at different levels and with different scopes of influence. Before I answer this, first some definitions :. The corporate strategy is the broadest and most long-ranging. It must be developed first to provide direction to the business and functional area planning efforts where the activities are planned and managed. So, it is the largest doll that all the others fit into.
Но мне она неизвестна. - Видите ли, ситуация не столь проста. Вы сказали, что самолет улетел почти пустой.
Corporate level strategy addresses the entire strategic scope of the firm.Maurelle Q. 02.06.2021 at 04:06
Strategy can be nothing but a buzzword, but successful businesses make it mean something.Loring C. 03.06.2021 at 08:41
PDF | On Mar 14, , Okechukwu Ikeanyibe published Strategy Formulation: Corporate, Business and Functional Strategies | Find, read and.Hocounheida 06.06.2021 at 18:31
Growth platforms are specifically named initiatives selected by a business organization to fuel revenue and earnings growth.