Strategic Management

TYBSc

LEVELS of Strategy

Strategies exist at a number of levels in an

organisation. There are basically 4 levels:

CORPORATE-level strategy

BUSINESS-level strategy

FUNCTIONAL strategy

OPERATIONAL strategy

Levels of Strategy

CORPORATE level Strategy:

Concerned with overall direction and scope of an
organisation
How value will be added to different business units
of the organisation
This may include geographical coverage, diversity
of products/services or business units
How resources are to be allocated between
different units

Corporate HQ plays a crucial role in

determining how the org should be structured,
how targets are set and performance reviewed
Ways in which we can add value to separate
business units within the company
Very concerned with the expectations of
owners, the shareholders, and the stock market
It forms the basis of other strategic decisions

Levels

BUSINESS level Strategy:

Can be thought as 2nd level strategy

How to compete successfully in particular

markets
Concern is how advantage over competitors
can be achieved
What new opportunities can be identified or
created in markets

Which products or services should be

developed in which markets and how to meet
customer needs so that the company's
objectives are achieved- e.g. Long-term
profitability, market share growth, etc
While corporate strategy involves decision of
the WHOLE organisation, while business level
strategy deals with decisions about SBU.

Levels

Functional strategies:
Detailed action plans that are undertaken in
functional areas to achieve short-term
objectives and establish competitive advantage
Identify the specific, immediate actions that
must be undertaken in functional areas such as
operations, finance, marketing, HR, etc to
implement business strategy

OPERATIONAL strategy:
4th level and it is at the operating end of an
organisation
Concerned with how the component parts of
an organisation deliver effectively the
corporate and business level strategies in
terms of resources, processes and people.

E.g. Of Functional strategy:

Production rescheduling, promotional
initiatives, pricing, distribution strategies, etc.
Most organisations depend on operational
strategies to a large extent-i.e. The decisions
that are taken here.

7 S Framework

7 S Framework (7SF)

Framework basically deals with organisational

change
The 7SF suggests that there are several
factors that influence an organisations ability
to change
Variables involved are interconnected so that
altering one element may well impact other
connected elements

7SF

There is no starting point or hierarchy in the

shape of the diagram
Hence, not obvious which of the 7 factors
would be the driving force in changing a
particular organisation at a particular point of
time
All the elements are equally important