Deutsche Borse's strategy derailed by the Hedge Funds

Deutsche Borse's strategy derailed by the Hedge Funds

Answer 1

Corporate Strategie

Formation of corporate strategy is very important to an organization and is being developed depending upon the overall conditions of the business or an organization. A corporate strategy or strategies tells the current position of an organization, where its management sees it in the future and how will they achieve their goals to get there. A corporate strategy is a direction that a business takes in order to achieve its short term and long-term goals and objectives. Corporate strategies of the organization comprises of several other strategies that are also very important to follow (Upadhyay, 2007)

Figure 1: corporate level strategies adopted by companies Now companies and businesses are moving towards change and adoption of new strategies that is most commonly known as flexible strategy. A corporate strategy helps establishing the purpose of an organization's business and activities, its current position in the market, the way it operates, and the competition it faces which is commonly done through the SWOT analysis

If an organization does not adapt change, it might face problems in its business development, its efficiency, and reputation too in turn facing problems in achieving its objectives. A CEO (Chief Executive Officer) is the management of a business (Teece, 2010). He is the one who defines the organizational strategies and how a business will achieve its objectives. The CEO should determine how the business should be organized, set some goals and define the policies and allocation of resources and the company's operational process (www.thecqi.org). An effective CEO is the one who is responsible for the successful corporate strategies of an organization. Hence, he should have the following skills that are clearly seen from the picture below

Develop a strategic plan for the company, which defines the result of effective performance.

Establishment of a clear vision of the organization

Identifying the strategic objectives that are in line with the vision of an organization

A balanced mix of risk

A flexible plan and strategy that is open towards change and innovation.

Define the values and policies of the organization in a way that it is a guiding path for the employees.

Monitoring and evaluation plan should be prepared.

Achieving its goals and meeting stakeholder's criteria.

Figure 2: road map for corporate level strategy

Since the appointment of the CEO of Deutsche Borse, Werner Seifert in the year 1993 had successfully turned a loss making company with worst reputation in to a company of innovation with a largest electronic derivative; exchange worldwide (Stulz, 2007). He along with his management had an aim to make it a financial center in the Europe. Although Seifert was, just an insurance executive but worked well with his capabilities to establish Switzerland derivative exchange market. He had no banking experience though but he never with draw in speaking to people who wanted to block change and innovation in the company. He projected and brought the concept of mergers of stock market and viewed ...