Case Study

Case Study

Case Study

Question 1:

(a)Compare and contrast the meaning of 'strategy' and 'corporate planning'

Strategy

There is no universal definition of strategy. Strategy applies to many disparate fields such as gaming strategy, economic strategy, investment strategy, military strategy, marketing strategy and indeed corporate global strategy. Taking a conventional approach, strategy can be thought of as a long term plan of action or execution designed to achieve a particular goal, such as achieving competitive advantage for an organisation. It reflects the values, expectations and goals of those who are in power within the organisation. These logical / prescriptive ideas about strategy emanate from the 'prescriptive' approach as advocated by early strategic writers (see Preface and the text Strategy Safari (Mintzberg et al, 1998)). Many early writers continue to be widely quoted, e.g. Michael Porter. Many recent writers have challenged this view of strategy. The study of corporate strategy has moved on into 'softer' areas and these issues need to be kept in mind. Early thinking (1960s) could be said to be 'modernist' in view, i.e. a unitary perspective - there was a single way to perform the task of strategy. There was an idea that data (both internal and external) could be fed into an analysis machine and the answer (the strategy) could be churned out. The 'postmodern' view refuted this, saying that a strategist view should be 'pluralist', i.e. take many diverse things into account and this is evidenced by a number of writers.

Corporate Strategy

Some definitions of business strategy that are helpful are as follows:

'Corporate strategy is the pattern of minor objectives, purposes or goals and essential policies or plans for achieving those goals, stated in such a way as to define what business the company is in or is to be in and the kind of company it is or is to be' Andrews K (1971). Page 8, Lynch.

'Strategy is the direction and scope of an organisation over the long term: which achieves advantage for the organisation through its configuration of its resources within a changing environment, to meet the needs of markets and fulfil stakeholders' expectations.'

Corporate Strategy:

Defines the strategy for the corporation (or organisation)

as a whole, and is cascaded to business units below.

Must be holistic and define the overall purpose and scope of the organisation.

Must be visionary in some measure.

Must ensure that the different parts of the organization add value to the overall strategy.

Must meet the expectations of major stakeholders.

Business Unit strategy:

Must be derived and be aligned with the corporate strategy.

Must be focused on how to compete in the particular markets or business areas for which the business unit has responsibility.

Can be visionary and creative within the context of its business remit.

Operational Strategy:

Must define and deliver the operational processes required to achieve the corporate and business unit strategy.

Must address the resource and resource development plans to support corporate and business unit strategy.

A further level of strategy, 'Network level strategy', is pertinent in today's business environment. Let us examine this in more ...