Corporate Level Strategy

STRATEGIC
MANAGEMENT
TABLE OF CONTENTS
INTRODUCTION AND
MEANING OF CORPORATE
LEVEL STRATEGY
TYPES OF CORPORATE
LEVEL STRATEGY IN DETAIL
CONCLUSION
CORPORATE LEVEL STRATEGY
 It is the overarching plan of action.

 It deals with the objectives of the company, allocation of resources,
coordination of SBU’s for optimal performance.
Definition
Growth Strategy:- An organization substantially broadens the scope of one or

more of its business in terms of there respective customers group, customers
function and alternative technologies to improve overall performance.
Types of Expansion Strategies
 Expansion through Concentration

 Expansion through integration
 Expansion through diversification
 Expansion through co-operation
 Expansion through internationalization
 Expansion through digitalization
CONCENTRATION STRATEGIES
This includes the resources involvement in

developing the product .
Business tries to focus on existing market.
ANSOFF’S PRODUCT-MARKET MATRIX
INTEGRATION STARTEGIES
 Integration means combining activities related to the present activity of the

company
 Integration is a part of diversification strategy
 It widens the scope of the company as far is the market penetration is
concerned
TYPES OF INTEGRATION STRATEGIES
 Horizontal Integration
 Vertical Integration
HORIZONTAL INTEGRATION
When an organization takes up the same types

of products at the same level of production or
marketing process, it is said to follow a strategy
of Horizontal integration(Also known as merger/
acquisition)
Example:- Takeover of satyam by mahindras
VERTICAL INTEGRATION
It means expansion to serve its own needs.

Vertical integration is of two types, namely
Backward and forward integration
 Backward integration means going back to the source of raw materials
Example:-A thermal power company may do coal-mining
 Forward integration implies moving closer to the finished product
Example:-A car spare parts manufacturer would start manufacturing

passenger cars
CO OPERATIVE STRATEGIES
The term co operation expresses the idea of

simultaneous competition and cooperation among
rival firms for mutual benefits. The central point is of
the complementarities among the interests of rival
firms.
TYPES OF COOPERATIVE STRATEGIES
Mergers and Acquisitions
Joint Ventures
Strategic Alliances
MERGER AND ACQUISITION
Merger is a combination of two or more

organizations in which one acquires the assets
and liabilities of the others in exchange of
shares or cash or both the organizations are
dissolved and assets and liabilities are combined
and new stock is issued.
Types of Mergers and Acquisition
Horizontal Mergers
Vertical Mergers
Concentric Mergers
Conglomerate Mergers
Joint Venture
It can be considered as an entity resulting from a long term

contractual agreement between two or more parties, to undertake
mutually beneficial economic activities, exercise joint control and
contribute equity and share in the profits or losses of the entity.
TYPES OF JOINT VENTURES
Between an
Indian
Between an
Indian organizations
Between an and foreign
organizations
Indian organization in
and foreign
Between Two organizations third country.
organization in
Indian and foreign
Foreign country.
Organizations organization in
Between Two
across different India.
Indian
organizations in industry.
one industry.
STRATEGIC ALLIANCES
Strategic Alliance is a cooperative arrangement between two or more

companies where
 All the parties adopt win-win attitude
 Everyone shares their specific strengths to the Enterprise
 Pooling of resources
REASONS FOR STRATEGIC ALLIANCES
Entering new
markets
Developing Reducing
and diffusing manufacturing
technology cost
INTERNATIONALISATION STRATEGIES
 Expansion strategy.
 Markets the products and services beyond domestic market.
 Self evaluation to enter into markets using this strategy.

TYPES OF INTERNATIONAL STRATEGY
 International strategy.
 Multi-domestic strategy.
 Global strategy.
 Transnational strategy.
INTERNATIONAL ENTRY MODES
 Export entry modes.
 Contractual entry modes
 Investment entry modes.

DIVERSIFICATION STRATEGIES
 It’s a corporate strategy to enter into a new market or industry which the
business is not currently in, also creating a new product for that new market.
TYPES OF DIVERSIFICATION STRATEGIES
Concentric or related diversification.

 Marketing related concentric diversification.
 Technology related concentric diversification.
 Marketing and technology related concentric diversification.
Conglomerate or Unrelated diversification.

WHY ARE DIVERSIFICATION STRATEGIES
ADOPTED?
 To minimize risk.
 Capitalize on its capabilities.
 To diversify if the growth is blocked in existing business.
RETRENCHMENT STRATEGY
 Retrenchment strategy is followed

when an organisation substantially
reduces the scope of its activities.
 It is done through an attempt to
find out the problem areas,
diagnose the causes of problems
and steps are taken to solve the
problems.
FACTORS AFFECTING RETRENCHMENT
FACTORS
EXTERNA
INTERNAL L
EXTERNAL FACTORS
 NEW ORGANISATIONAL FORMS.

 NEW DOMINANT TECHNOLOGIES
 NEW BUSINESS MODELS
 ADVERSE GOVERNMENT POLICIES
 DEMAND SATURATION
 CHANGING CUSTOMER NEEDS AND PREFERENCES.
 EMERGENCE OF SUBSTITUE PRODUCTS.
INTERNAL FACTORS
 INEFFECTIVE TOP MANAGEMENT.

 INAPPROPRIATE STRATEGIES.
 CONTINUAL RESISTANCE TO EXTERNALLY IMPOSED CHANGE.
 POOR QUALITY OF FUNCTIONAL MANAGEMENT.
 WRONG ORGANIZATIONAL DESIGN.
 EXCESS ASSETS
 HIGH COSTS
 UNPRODUCTIVE NEW PRODUCT DEVELOPMENT.
TYPES OF RETRENCHMENT STRATEGY
TURNAROUND STRATEGY
 Reversing the negative trend and

turning around the organisational
profitability.
 Serious form of external
retrenchment.
 Emphasis is laid on improving
internal efficiency.
DIVESTMENT STRATGEGY
 Also known as divestiture or cut

back.
 Sale or liquidation of portion of
assets.
 It is a part of rehabilitation or
restructuring plan.
LIQUIDATION STRATEGY
 Considered to be the most extreme

and unattractive.
 Closing down an organisation and
selling its assets.
 Considered as the last resort.
LEGAL ASPECTS OF LIQUIDATION
 Under the Companies Act of 1956 liquidation is termed as winding up.

 Company’s life comes to an end.
 Liquidator is appointed to carry out liquidation process.
 When the affairs are wound up, the dissolution takes place.
THANK YOU

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STRATEGIC

 It is the overarching plan of action.

Growth Strategy:- An organization substantially broadens the scope of one or

 Expansion through Concentration

This includes the resources involvement in

 Integration means combining activities related to the present activity of the

When an organization takes up the same types

It means expansion to serve its own needs.

 Forward integration implies moving closer to the finished product

Example:-A car spare parts manufacturer would start manufacturing

The term co operation expresses the idea of

Mergers and Acquisitions

Merger is a combination of two or more

It can be considered as an entity resulting from a long term

Strategic Alliance is a cooperative arrangement between two or more

 Markets the products and services beyond domestic market.

 Self evaluation to enter into markets using this strategy.

 Export entry modes.

 Contractual entry modes

 Investment entry modes.

Concentric or related diversification.

Conglomerate or Unrelated diversification.

 Retrenchment strategy is followed

 NEW ORGANISATIONAL FORMS.

 INEFFECTIVE TOP MANAGEMENT.

 Reversing the negative trend and

 Also known as divestiture or cut

 Considered to be the most extreme

 Under the Companies Act of 1956 liquidation is termed as winding up.

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