The elements of

corporate strategy
Requirements for Strategy:
One needs to decide, often
some time in advance
0 What is to be achieved?
0 What action is to be taken?
0 When it is to be completed?
0 How it is to be done?
0 By whom?
 Corporate strategic plan

Much higher level and involves the whole organization

Actions that the corporation needs to take to get from its present
position to where its vision of the future says

Vision
Present Strategic Plan of
Future
A strategic plan is often long range, for several reasons:

0 Usually involves high levels of investment in terms of

capital and people which need time to develop

0 Businesses are becoming much more global

0 Technological changes need to be predicted and

intercepted
Strategic Planning: Tactical Planning:

 upper management  contained in the strategic

generally develops the plan
strategic plans  lower level managers
 based primarily on a develop the tactical plans
prediction of the future  based on known
 Under constant review- circumstances that exist
some changes in business within the organization
environment unpredictable
 cover a relatively long  cover a relatively short
period of time period of time
Four distinct stages:
1. entrepreneur or birth stage – “start up companies”

2. expansion and consolidation stages – period of rapid

growth; maximum coverage of chosen markets

3. diversification stage – to reduce risk or dependence on a

single product, customer or market segment

4. decline and renewal stages – enable to survive and to

grow again and to renew itself
 Things to consider for long term
strategy
0 Stage that the organization is in
0 External factors such environment, political
and technological
0 Business the organization wishes to undertake
– note that a company can operate
simultaneously in several columns (i.e., 1st
product in Marketing only and 2nd product in
Design only, etc.)
0 The strategic plan needs to meet the cultural
background of the company concerned and the
image it wishes to project to its customer and
employees.
 Strategic ownership

the owner of the strategic plan is the chief executive

Although, every level within the organization must
contribute
It covers all the functions within a company
Layers of corporate strategy:
Finance
The strategy in
one area affects Product sales
other areas such
as product Product marketing
development
having to Product manufacture
consider the
needs of
Product Development
manufacturing,
Technology development
marketing, and Process development
finance (profit Environmental factors
and loss). Political consideration
0 A key aim of corporate strategy is to improve the
overall capabilities of the company.
0 Business processes are the prime elements of a
strategic plan and not the products being made.
0 A company needs to invest in its processes and
develop a support infrastructure that can deliver
value to the customer.
 Key requirements of
an effective process are:

 The process is geared to meeting the customer’s needs.

The process must allow fast response to changes in
environment, such as competitor activity or political
changes.
 The process must be transferrable.
 The process must be expandable.