Corporate Strategy

Course Module in Business Strategy

Course Modules help instructors select and sequence material for use as part of a course. Each module
represents the thinking of subject matter experts about the best materials to assign and how to organize
them to facilitate learning.

Each module recommends four to six items. Whenever possible at least one alternative item for each
main recommendation is included, as well as suggested supplemental readings that may provide a
broader conceptual context. Cases form the core of many modules but we also include readings from
Harvard Business Review, background notes, and other course materials.

1. Overview of suggested content (HBS case unless otherwise noted)

Product Publication
Title Author Pages Teaching Note
Number Year
1. Related Diversification
Walt Disney Co.: The Rukstad, 701035 2001 27p 705495
Entertainment King Collis &
Levine
and International Anand & 702409 2001 23p 705414
Management Group (IMG) Attea

Alternative 1: The Walt Alcacer 709462 2009 28p 711451

Disney Company and Pixar,
Inc.: To Acquire or Not to
Acquire?
Alternative 2: Arauco (A): Casadesus - 705474 2005 34p 706439
Forward Integration or Masanell,
Horizontal Expansion? Tarzijan &
Mitchell
Alternative 3: Haier: Taking a Khanna, 706401 2005 27p 707459
Chinese Company Global Vargas,
Palepu
Supplement: Emerging Khanna & 703431 2002 19p --
Giants: Building World-Class Palepu
Companies in Emerging
Markets (HBR article)
2. Unrelated Diversification
GE's Two-Decade Bartlett 399150 1999 24p 300019
Transformation: Jack Welch's
Leadership
Alternative 1: House of Khanna, 798037 1998 18p 701039
Tata—1995: The Next Palepu & Wu
Generation (A)
Alternative 2: Corporate Wulf & 710414 2010 25p 711467
Strategy at Berkshire Waggoner
Partners
Supplement 1: Finding a Mahindra, R0807F 2008 11p --
Higher Gear (HBR article) Stewart &
Raman
Supplement 2: Strategies of Jayanti & 705480 2005 9p --
Unrelated Diversification Anand
(HBS note)

3. Organizational Structure
Procter & Gamble: Piskorski & 707519 2007 23p 708450
Organization 2005 Spadini
Alternative: The IOI Group: Dielman & 910M68 2010 17p 810M68
Creating a Malyasian Palm Mittal
Oil Multinational (Ivey case)
Supplement: Connect and Huston & R0603C 2006 11p --
Develop: Inside Procter & Sakkab
Gamble’s New Model for
Innovation (HBR article)
4. Alliances and Integrations
DaimlerChrysler Merger: The Cohen BAB041 2000 27p BAB541
Quest to Create “One
Company” (Babson case)
Alternative 1: UTV and Adhikari & 910M43 2010 20p 810M43
Disney: A Strategic Alliance Deshmukh
(Ivey case)
Alternative 2: Baoshan Iron & Tao & Ho HKU188 2002 19p HKU229
Steel Co. Ltd.: Crafting a
Three-Way Cross-Border,
Cross-Shareholding Alliance
(Hong Kong case)
5. Strategic Renewal
Newell Rubbermaid: Strategy Montgomery 704491 2004 25p --
in Transition
Alternative: Microsoft’s Farhoomand HKU617 2006 27p HKU592
Diversification Strategy & Tsang
Supplement 1: Mergers and Hitt et al. BH353 2009 7p --
acquisitions: Overcoming
pitfall, building synergy, and
creating value
(Business Horizons article)
Supplement 2: Quest for Hamel & R0309C 2003 7p --
Resilience (HBR article) Valikangas

II. Rationale for selecting and sequencing the items in this module

Materials on Corporate Strategy look at multi-business corporations and examine how participation in
several industries and/or regions can enhance, or undermine the competitive advantage of a corporation
and each of its businesses. This module draws on foundational skills developed in modules on Industry
Analysis, Competitive Advantage and Competitive Dynamics: participating in several industries and
regions alters the competitive forces a firm faces, modifies the sources of competitive advantage it can
draw on, and changes the dynamics it encounters over time.

Section 1 focuses on related diversification, opening with an intriguing case pairing that contrasts a
corporation that maximizes value from resources it owns (Disney) with another that derives value from its
ability to employ resources it does not own (IMG). The alternate cases look at other means of related
diversification: vertical integration, horizontal expansion, and geographic expansion.

Section 2 looks at unrelated diversification and focuses on GE, a diversified conglomerate finding ways
to thrive in an age when many conglomerates have been broken up. Some recent trends in diversified
corporate entities include the rise of business groups in emerging markets (Tata) as well as the growing
impact of private equity firms (Berkshire Partners).

Section 3 moves to the topic of how a multi-business corporation can maximize value by paying attention
to its organizational structure.

Section 4 covers the potential benefits (and concomitant challenges) for corporations that look to
increase value through alliances and mergers/integrations with other corporations.

Section 5 looks at the challenge of strategic renewal for the multi-business corporation.