Strategic management. Lecture 7 Corporate strategy and strategic portfolio. LEVELS OF STRATEGY. Corporate level Determine overall scope of the organisation Add value to the different business units Meet expectations of stakeholders Business level (SBU)
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Corporate strategy and strategic portfolio
1. level: The corporate level
At this level the fundamental task is to develop a balanced portfolio of businesses which will achieve the goals of the corporation and satisfy its stakeholders.
2. level: The strategic business unit level (SBU)
At this level the business, or set of activities is given and the major task for strategic planner at this level is for business to succeed against competitors and also satisfy corporate success criteria.
3. level: The functional level:
At this level the major task is to provide an appropriate functional strategies ( finance and accounting, marketing, R+D, production, personnel) for SBU or corporate level strategy.
A strategic business unit (SBU) is a part of an organisation for which there is a distinct external market for goods or services that is different from another SBU
The SBUsarethe natural ‘grouping’ of part of a corporation.
From viewpoint of strategic management the corporations are collections of different “product-market-consumer-resource packages”. These are the SBU’s. We can describe the sum of SBU’s, as portfolio.
The portfolio analysis:
Introduction Growth Maturity Decline
Drivers of industry evolution :
Corporate purpose and aspirations
Mission and strategic intent
Scope and diversity
The global dimension
Bases of SBU strategy
Achieving competitive advantage
Enhancing SBU strategy: corporate parenting
The role of the corporate parent
The parenting matrix