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Strategy formulation: Corporate level

strategies and Business level strategies
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Text and References
Ref. 1: Azhar kazmi: Chap 6: Corporate
level strategies; Pages 165-216
Chap 7: Business level Strategies
Ref. 2: Pearce & Robinson: Chap 2: The
strategic Management Process; Pages
50-70
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Ref 3: Thomson L. Wheelen & J. David
Hunger (8
th
ed.): Concepts in Strategic
Management and Business Policy: Chap
6: Strategy formulation: Corporate
Strategy; Pages 136-63;
Chapter 7: Strategy formulation:
Functional Strategy and Strategic
choice; Pages 164-90.
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Corporate level Strategies deal with 3
main issues facing the corporation as a
whole
I.Diectional
Strategies
II.Portfolio
Strategies
III.Parenting
Strategies
Corporate
level
Strategies
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I. Corporate Directional
Strategies
The firms overall orientation
towards growth, stability, or
retrenchment.
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1. Growth
Strategies
2. Stability
Strategies
3. Retrenchment
Strategies
I.Corporate
Directional
Strategies
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Vertical
Growth
Horizontal
Growth
Concentration
Concentric
(Related)
Conglomerate
(Unrelated)
Diversification
1.Growth
Strategies
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Pause Proceed with
Caution
No Change Profit
2. Stability
Strategies
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Turn
Around
Captive
Company
Sell-out/
Divestment
Bankruptcy/
Liquidation
3. Retrenchment
Strategies
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II. Corporate Portfolio analysis
Still used by 27% of Fortune 500 companies.
Top management views its product lines and
business units as a series of investments from
which it expects a profitable return
The product-lines/ Business units form a
portfolio of investments that Top management
must constantly juggle to ensure the best
return on the corporations invested money.
Two most popular approaches-BCG growth
share matrix / GE business screen
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III. Corporate Parenting
strategies
The manner in which the management
coordinates activities, transfers
resources, and cultivates capabilities
among product lines and business units.
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Parenting fit matrix


Ballast
Heart land

Edge of
heart land


Alien territory



Value trap

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Vertical axis: (top to bottom: Low to
High): Misfit between critical success
factors and parenting characteristics
Horizontal axis: (Left to right: Low to
high): Fit between parenting
opportunities and parenting
characteristics.