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Corporate Directional Strategies

Corporate Directional Strategies

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Corporate Directional Strategies

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  1. Corporate Directional Strategies Chapter 6 Wheelen/Hunger

  2. Corporate Strategy Directional Strategy: • Three Grand Strategies: • Growth strategies • Stability strategies • Retrenchment strategies Chapter 6 Wheelen/Hunger

  3. Corporate Strategy Growth Strategies: • Most widely pursued strategies • External mechanisms: • Mergers • Transaction involving two or more firms in which stock is exchanged but only one firm survives. • Acquisition • Purchase of a firm that is absorbed as an operating subsidiary of the acquiring firm. • Strategic Alliance • Partnership of two or more firms to achieve strategically significant objectives that are mutually beneficial. Chapter 6 Wheelen/Hunger

  4. Corporate Strategy 2 Basic Growth Strategies: • Concentration • Current product line in one industry • Diversification • Into other product lines in other industries Chapter 6 Wheelen/Hunger

  5. Corporate Strategy Basic Concentration Strategies: • Vertical growth • Horizontal growth Chapter 6 Wheelen/Hunger

  6. Corporate Strategy Concentration: Vertical growth • Vertical integration • Full integration • Taper integration • Quasi-integration • Backward integration • Forward integration Chapter 6 Wheelen/Hunger

  7. Corporate Strategy Concentration: Horizontal Growth • Horizontal integration Chapter 6 Wheelen/Hunger

  8. Corporate Strategy Basic Diversification Strategies: • Concentric Diversification • Conglomerate Diversification Chapter 6 Wheelen/Hunger

  9. Corporate Strategy Diversification: Concentric: • Growth into related industry • Search for synergies Chapter 6 Wheelen/Hunger

  10. Corporate Strategy Diversification: Conglomerate: • Growth into unrelated industry • Concern with financial considerations Chapter 6 Wheelen/Hunger

  11. Corporate Strategy Exporting Licensing Franchising Joint Ventures Acquisitions Green-Field Development Production Sharing Turnkey Operations BOT Concept Management Contracts International Entry Options Chapter 6 Wheelen/Hunger

  12. Corporate Strategy Stability Strategies: • Pause/proceed with caution • No change • Profit strategies Chapter 6 Wheelen/Hunger

  13. Corporate Strategy Retrenchment Strategies: • Turnaround • Captive Company Strategy • Selling out • Bankruptcy • Liquidation Chapter 6 Wheelen/Hunger

  14. International Portfolio Analysis 2 Factors: • Country’s attractiveness • Market size, rate of growth, regulation • Competitive strength • Market share, product fit, contribution margin, market support Chapter 6 Wheelen/Hunger