CHAPTER 7 Strategy Formulation Corporate Strategy 1 Corporate
- Slides: 22
CHAPTER 7 Strategy Formulation: Corporate Strategy 1
Corporate Strategy 3 Key Issues – –Firm’s directional strategy –Firm’s portfolio strategy –Firm’s parenting strategy 2
Corporate Directional Strategies 3
Corporate Strategy Directional Strategy – –Orientation toward growth • Expansion, contraction, status quo • Concentration or diversification • Internal development or acquisitions, mergers, or alliances 4
Corporate Strategy Directional Strategy – – 3 Grand Strategies • Growth strategies • Stability strategies • Retrenchment strategies 5
Corporate Strategy Growth Strategies -–External mechanisms • Mergers • Acquisitions • Strategic alliances 6
Corporate Strategy Growth Strategies -– 2 Basic forms • Concentration • Diversification 7
Corporate Strategy Basic Concentration Strategies -–Vertical growth –Horizontal growth 8
Corporate Strategy Vertical Growth -–Vertical integration • Full integration • Taper integration • Quasi-integration • Long-term contract 9
Corporate Strategy Vertical Growth -–Backward integration –Forward integration 10
Corporate Strategy Concentration -–Horizontal Growth • Horizontal integration 11
Corporate Strategy Basic Diversification Strategies -–Concentric Diversification –Conglomerate Diversification 12
Corporate Strategy Concentric Diversification -–Growth into related industry –Search for synergies 13
Corporate Strategy Conglomerate diversification -–Growth into unrelated industry –Concern with financial considerations 14
Corporate Strategy International Entry Options -–Exporting –Licensing –Franchising –Joint Ventures –Acquisitions –Green-Field Development 15
Corporate Strategy International Entry Options -–Production Sharing –Turnkey Operation –BOT Concept (Build, Operate, Transfer) –Management Contracts 16
Corporate Strategy Stability Strategies -–Pause/proceed with caution –No change –Profit strategies 17
Corporate Strategy Retrenchment Strategies -–Turnaround –Captive Company Strategy –Selling out –Bankruptcy –Liquidation 18
Corporate Strategy Portfolio Analysis -–Resource commitment on best products to ensure continued success –Resource commitment on new costly products high risk 19
BCG Matrix (Portfolio Analysis) 20
GE Business Screen (Portfolio Analysis) High Winners A Winners B C Question Marks Industry Attractiveness D Winners E Medium Average Businesses F Losers G Low Profit Producers Strong H Losers Average Weak Business Strength/Competitive Position 21
Corporate Strategy Corporate Parenting Strategy – Views a corporation in terms of resources and capabilities that can be used to build business unit value as well as generate synergies across business units. –Strategic factors –Performance improvement –Analyze fit 22
- Parenting strategy in strategic management
- Internal governance mechanisms
- Why problem formulation follow goal formulation
- Strategy formation
- Corporate strategy and business strategy
- Strategic hrm models
- Types of strategy formulation
- Strategy formulation process
- Strategy formulation process
- Functional strategy and strategic choice
- Matching stage in strategic management
- Functional strategy and strategic choice
- Objective of corporate finance
- Types of organizational strategies
- What is corporate strategy in strategic management
- Business vs corporate strategy
- 3 dimensions of corporate strategy
- Hr-strategy map
- Diversification horizontal
- Business strategy of tata motors
- Corporate strategy triangle
- A multidomestic corporate-level strategy is one in which:
- Corporate level cooperative strategy