Week 4

❖ Functional Responsibilities vs. Functional Strategies

Functional responsibilities- refer to those tasks, function or activities that a

given operating unit is duty-bound to do by the very nature of its functional
category.

Functional strategy- is the approach taken by a functional area or unit to

achieve its objectives and duties by way of maximizing the use of its resources
and in light of strategic direction as well as prevailing market competitions.

-
Broadly addresses how the particular mandate or duty of a
concerned department or unit will be done and carried out or
how it will operationalized its duties and responsibilities in view
highly competitive environment.
❖ Nature and Characteristics of Functional Strategies
• It is a game plan for a strategically-relevant function, activity, or business process
• It provides details how key activities will be managed
• It provides a supportive role to the business level strategy
• It specifies how functional objectives are to be achieved
❖ Operating Strategies
Operating strategies are tasks that are more specific compared to functional
strategies. It is more operational compared to functional strategies as the tasks
are usually done at ground level with more precise details.

Concerns of Operating Strategies:

1. Narrower strategies for managing grassroots activities and strategically-
relevant operating units; and
2. Add detail to business and functional strategies.

Examples of Operating Strategy:

Strategy Process Example

Customer Needs More Products

Corporate Strategy Increase Organization’s

Size

Operations Strategy Increase Production

Capacity

Decisions on Process and Build New Factory

Infrastructure

Operations Strategy
{source: Chase, Jacobs and Aquilano (2002)}

❖ Strategic Business-Level Options

This principle in strategic options to grow or expand as discussed in the corporate level
strategies is in a way applicable as strategic business options.
a. Product Development Option- it is a research and development option that seeks to
develop new product or service resulting to a variety of products or services the
company can offer thereby accessing other market segments or sectors.

Strategic Management Page 3 of 4

 Week 4

b. Market Development- seeks to explore additional market share by developing other

markets in other geographical areas using the same line products or services.
c. Market Penetration- it is pursuing concentrated and vigorous efforts to push a
product or service using a variety of marketing strategies or tools generally focused
on promotional efforts.

End of Week 4

-----Nothing Follows------

Strategic Management Page 4 of 4