Dr Sandeep Kulshrestha

At a company’s level Setting the agendas of the immediate and long term future

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Allocating resources among the different businesses of a company Transferring resources from one business to another Managing a portfolio of businesses

…With an aim to achieve overall corporate objectives

Sets the Direction

Small company may think of diversifying Big corporate house may think of adding more businesses (eg. Tatas/Ambanis) A company may think of becoming an International Firm (eg. Infosys/TCS) A company may think of selling one of its business units…

In all cases above, some direction is needed…

Diverse and different businesses (eg; TATA manufactures salt as well as passenger cars) Diverse customer base Different technologies

• Customer Groups

• Customer Functions

• Alternative Technologies

Expansion/Diversification Stability Retrenchment Combination Strategy

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Broadening the scope of existing businesses Expanding into newer businesses Backward integration strategy

Cadbury’s strategy to expand the customer base (Kuch meetha ho jaye campaign) Indigo Airlines’ entry into International routes TATA Group’s tie-up with STARBUCKS for opening coffee shops across India

Seeking Incremental improvement in performance Marginal change in Business Examples: Plant Modernization, better after sales service etc

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Need of contraction or closing down a business or multiple businesses Closing down of a particular geographic location Examples: Premier Automobiles had to close down owing to fierce competition, Gutkha manufactures in Maharashtra have to close down owing to ban on Gutkha

Can be a mix of Expansion, Stability and Retrenchment. Example: A Pharmaceutical company may start a Hospital (Expansion), innovate in its medicine business (Stability) and shut down specialty drugs business (Retrenchment)

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