Samenvatting - International Corporate Management

1 What is corporate strategy ?
 Action plan for conducting business operations
 Present situation analysis (swot)
 Where to go in the future? Which directions do I take?
 Strategy: based on present situation analysis and intended future
direction, the action plan is drafted

1.1 Strategy characteristics
 Long term action plans
 Unique to each company (based on a unique set of
competencies, resources and capabilities)
 Should provide a sustainable competitive edge
over rivals
 Strategies evolve overtime
1.1.1 Company strategies – why are they
unique
 Unique resources, competencies and
capabilities
 Competitive advantage can only be the
result of distinct strategies
 Discussion topic: can start up companies
adopt a mini-version of an established
company’s strategy?
1.2 Sustainable competitive advantage
 Competitive advantage results from meeting
customer needs more efficiently (similar
products/services at lower cost; more efficiently
(providing product and service features that are
valued more by customers) – refer generic
strategies
 Providing lasting reasons for purchase creates
sustainability
1.3 Why strategies evolve?
 Market situation evolves: new competitors,
industry trends, market trends
 Technological advancements, new ideas
 Changing customer preferences and needs
1.4 Strategic actions
 Actions to gain market share by enhancing
features, achieving lower costs, focus on specific
segments (generic strategies, value chain
analysis, integration/outsourcing strategies etc.)




1
Summary International Corporate Management

,  Actions related to entering new businesses or
closing some to better focus on core business
(diversification/consolidation)
 Entering new markets/quitting non-profitable ones
 Strengthening marker position and
competitiveness through merger and acquisitions


1.5 Business model
 Shows how the money is made in a specific
business.
 Compares revenue streams to cost structure to
determine if the business idea and related
strategies are viable.
1.6 Strategy VS business model
 Strategy deals with a company competitive
initiatives and business approaches
Whereas
 The business model concerns whether revenues
and costs flowing from the strategy demonstrate a
business can be amply profitable and viable
1.7 Strategy test
 Does it lead to sustainable competitive
advantage?
 Whether it takes into account the competencies,
resources and whether fits well into the firms
situation
 Does it improve firms performance (present and
future)
1.8 Strategic vision and mission
 A strategic vision concerns a firm’s future
business path – “where are we going”
 markets to be pursued
 future
product/market/customer/technology focus
kind of company management is trying to
create
 The mission statement of a firm focuses on its
present business purpose – “who we are and what
we do”
Current product and service offerings
Customer needs being served
Technological and business capabilities
1.9 Company objectives
 Objectives convert vision into specific targets
 Are yardsticks to track and evaluate performance
 Should be quantifiable, measurable, time-bound

2
Summary International Corporate Management

, 1.10 Financial VS strategic objectives
 Financial objectives are focused on improving
financial performance
 Strategic objectives are aimed at building
competitiveness and future performance
1.11 Balanced scoreboard
 It’s a performance metric that helps to measure
and provide feedback to assist in implementing
strategies and objectives
 Presents a mixture of financial and non-financial
measures, each compared to a target value


1.12 Formulating strategy
 External factor analysis
 Internal factor analysis
 Finding opportunities to do new things or seeking
to do things in new/improved ways to create value
 Timely response to shifting market conditions
1.13 Strategy making hierarchy




1.14 Corporate level strategy
 Allocation of resources across businesses
 Diversification/consolidation
 Building cross business synergies
 Improve performance of individual businesses

3
Summary International Corporate Management

,  Decided at top managerial level

1.15 Business level strategies
 Improve performance of specific business
 Build competitive competences and capabilities to
achieve competitive edge
 Uniting strategic activities of functional areas
 Applicable to companies operating multiple
businesses




1.16 Functional level strategies
 Setting up financial level objectives
 Planning for managing key activities in the
respective functional area
 Formulating strategies in coordination with
another strategy hierarchy levels as well as other
1.17 Operating strategies
 Strategies to manage key operating units
 Add detail to business and functional level
strategies
1.18 Implementing strategy
 Without proper execution/implementation, even
well-conceived strategies do not produce results
 Strategy implementation involves allocating
resources, making effective policies, installing
suitable communication an information systems,
leadership and building and organizational culture
that supports strategy implementation
1.19 Evaluation and control
 Strategies evolve due to shift in market
conditions, changes in external and internal
environment
 Regular evaluation of performance to judge the
effectiveness of strategies should be carried out to
make desirable changes to strategies.




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Summary International Corporate Management