Case Study:

Corporate Strategy
By Senior Lecturer Ashish Nanda of Harvard Business School

Presented By: Zoha Malik 317-1723

Adeel Aslam 317-1729
Umar Khan 317-1708
Hamza Rana 317-1721
Role of a
Strategist
To make a Corporate Strategy, you must answer:

● What products/services to cater(provide).

● Which customers to cater it to.
● Where to cater it i.e geographically.
● How to cater it i.e Marketing Strategy.
Purpose of
this Case
Study
It will provide you with:

● A way of thinking to help make your corporate strategy.

● It will lead to determining the scope of your firm.
● Also to finding an efficient way to manage your firm.
Dimensions
of a scope of
a firm
 There are 3 dimensions to a scope of a firm

Horizontal Scope Vertical Scope Geographical Scope

Select range of Select the part of your firm Select your firm’s
product markets in a supply chain. i.e: presence in the market.
of your firm.
● Designing ● City-wide
● Raw Materials ● State-wide
● Manufacturing ● Country-wide
● Distribution
● Retailing
● Globally
 How to
determine the
scope of your
firm Across all
3 dimensions?
It can be determined with the following tests:

Better-off Test: Ownership Test:

It is a test to see if it is better-off for your It is a test to see if owning 2 business
firm financially if 2 of your product
units create more competitive advantage
markets merge?
than other alternatives.
It relies on 2 things:
It relies on argument of 2 things:
● Cost-side economies of scope i.e. Cost
of them together < Cost of them ● Missing Markets.
individually ● Relationship-specific Investment.
● Revenue-side economies of scope i.e.
Revenue of them together > Revenue
of them separately
How the Tests
can
determine the
scope of your
firm?
Summary of how the tests help you determine scope of your firm:

Horizontal Scope Vertical Scope Geographic Scope

It tells you if the It tells you that the It tells you that if it is better-
ownership of 2 separate relationship specificity of off to own companies at both
business units ensure investments leads to long locations than to outsource it
sharing of resources and term contracting between in 1 location.
information that would not suppliers, manufacturers,
be replicable through distribution and retailers.
outside contracting.
Thank you
For Nothing!