1. CORPORATE MANAGEMENT IN ACTION - CMA
Session 2. Strategies for the Global Organization
CORPORATE MANAGEMENT IN ACTION - CMA

2. CORPORATE MANAGEMENT IN ACTION - CMA
Session 2. Strategies for the Global Organization
Chapter Objectives
Formulate Vision and Mission
Understand Organizational Goals
Benefit from Core Competencies
Design Strategy and Implement it
Evaluate Strategy Implementation
CORPORATE MANAGEMENT IN ACTION - CMA

3. CORPORATE MANAGEMENT IN ACTION - CMA
Vision & Mission
Vision
Expresses an organization’s fundamental aspirations and purpose, usually by appealing to its members’ hearts and minds
Mission
The organization’s purpose or reason for existing; often answers questions such as:
What business are we in?
Who are we?
What are we about?
CORPORATE MANAGEMENT IN ACTION - CMA

4. CORPORATE MANAGEMENT IN ACTION - CMA
Vision & Mission: Examples
Vision
“To pioneer new communities around the world built on commerce, sustained by trust, and inspired by opportunity” (E-Bay)
Mission
“To serve as the world’s online marketplace for the sale and payment of goods and services by a diverse community of individuals and businesses” (E-Bay)
“To make the people happy” (Walt Disney)
CORPORATE MANAGEMENT IN ACTION - CMA

5. CORPORATE MANAGEMENT IN ACTION - CMA
Organizational Goals
Organizational Goals:
Desired business outcomes, set as criteria against which performance is measured.
Organizations have multiple goals at all times
Types of Goals:
Financial: relate to financial performance (profits, ROI, …)
Organizational: relate to all other functions (efficiency, market share, etc…)
CORPORATE MANAGEMENT IN ACTION - CMA

6. CORPORATE MANAGEMENT IN ACTION - CMA
Core Competencies
Core competencies:
Valuable
Rare and unavailable to others
Difficult to imitate
Organized for synergy
Human resources are the most important source of core competencies to organizations
Core competencies affect resource allocation schemes for strategy planning & implementation
CORPORATE MANAGEMENT IN ACTION - CMA

7. CORPORATE MANAGEMENT IN ACTION - CMA
STRATEGIC PLANNING: Definition
Strategic Planning
Devising a set of plans in line with the organizational vision, mission, and strategy, in order to achieve organizational goals
Effective planning helps in:
Discovering new opportunities
Anticipating future risks / problems
Devising correct set of actions
Strategy Vs. Tactics:
Strategy: set as “static” as a result of strategic plan
Tactics: “dynamic” actions based on daily situations
CORPORATE MANAGEMENT IN ACTION - CMA

8. CORPORATE MANAGEMENT IN ACTION - CMA
STRATEGIC PLANNING: Steps
vision & mission
SWOT Analysis: strengths, weaknesses, opportunities, threats.
Set Organizational Goals
Formulate strategy
Allocate resources
Implement strategy
Evaluate & rectify
CORPORATE MANAGEMENT IN ACTION - CMA

9. Organizational Strategy: Types CORPORATE MANAGEMENT IN ACTION - CMA
Two main Strategy Levels:
Business Level Strategy
An integrated set of actions a firm takes to gain competitive advantage
Strategy should enable firms to create product/service advantage
It should be supported by the firms’ culture
Corporate Level Strategy
From one product group, to multi product groups
CORPORATE MANAGEMENT IN ACTION - CMA

10. Organizational Strategy: Types CORPORATE MANAGEMENT IN ACTION - CMA
Business Level Strategy: 4 Types
1. Cost Leadership:
Produce goods at lower prices
Must create value for customers
Sustained capital investment
Process engineering skills
Supervision of labor
Low cost distribution systems
Products with easy manufacturing process
Tight cost control
Frequent detailed cost reports
Structures organization
Incentives to meet targets
CORPORATE MANAGEMENT IN ACTION - CMA

11. Organizational Strategy: Types CORPORATE MANAGEMENT IN ACTION - CMA
Business Level Strategy: 4 Types
2. Product Differentiation:
Develop products with features different to that of competitors
Resist price increases
Maintain cost levels
If the features are unique, consumers may pay higher prices
Strong marketing
Product engineering, technological leadership
Creative abilities, strong research teams
Cooperative partners, stakeholders
Reputation
CORPORATE MANAGEMENT IN ACTION - CMA

12. Organizational Strategy: Types CORPORATE MANAGEMENT IN ACTION - CMA
Business Level Strategy: 4 Types
3. Focus Strategy:
Target a particular group
Target a different segment
Target a different geographic market
Focused cost leadership
Focused differentiated leadership
CORPORATE MANAGEMENT IN ACTION - CMA

13. Organizational Strategy: Types CORPORATE MANAGEMENT IN ACTION - CMA
Business Level Strategy: 4 Types
4. Integrated Strategy:
Customers expect both: differentiated products, at competitive prices
Use flexible manufacturing systems,
Information systems
Quality control
CORPORATE MANAGEMENT IN ACTION - CMA

14. Organizational Strategy: Types CORPORATE MANAGEMENT IN ACTION - CMA
Corporate Level Strategy: 3 Types
A. Growth Strategy:
Widely pursued; combination of expansion in existing line; adding new products/services/markets, or diversification to new lines/industries
New product development, mergers and acquisitions, strategic alliances
CORPORATE MANAGEMENT IN ACTION - CMA

15. Organizational Strategy: Types CORPORATE MANAGEMENT IN ACTION - CMA
Corporate Level Strategy: 3 Types
B. Concentration Strategy:
Vertical growth
Backward integration
Forward Integration
Horizontal growth
Increasing range of products
Tapping new markets
Acquiring manufacturing facilities
Acquisitions
CORPORATE MANAGEMENT IN ACTION - CMA

16. Organizational Strategy: Types CORPORATE MANAGEMENT IN ACTION - CMA
Corporate Level Strategy: 3 Types
C. Diversification Strategy:
I. Concentric or related diversification
Acquisition, joint venture into a market with common customers
Use of existing industry expertise
II. Conglomerate or unrelated diversification
CORPORATE MANAGEMENT IN ACTION - CMA

17. CORPORATE MANAGEMENT IN ACTION - CMA
STRATEGIC PLANNING:
Common Mistakes
Pitfalls in Strategic Planning: Avoid
Using strategic planning to gain control over decisions and resources
Doing strategic planning only to satisfy accreditation or regulatory requirements
Too hastily moving from mission development to strategy formulation
Failing to communicate the plan to employees, who continue working in the dark
Top managers making many intuitive decisions that conflict with the formal plan
Top managers not actively supporting the strategic-planning process
Failing to use plans as a standard for measuring performance
Delegating planning to a “planner” rather than involving all managers
Failing to involve key employees in all phases of planning
Failing to create a collaborative climate supportive of change
Viewing planning as unnecessary
Becoming so occupied with current problems
Being so formal in planning that flexibility and creativity are stifled 
FADI MAJZOUB (2013)
CORPORATE MANAGEMENT IN ACTION - CMA