Corporate strategy is actually concerned with strategic decisions the business makes, which affect the whole organization. The financial performance, acquisitions and mergers, the human resource management as well as allocation of the resources are all considered to be a part of the corporate strategy. There’re 3 kinds of the corporate level strategy, which the business may employ.
Value Neutral Strategy
The business will employ the value neutral strategy while organization is not very much concerned in allocating resources & manpower since it is to secure the current place in market. Essentially, the value neutral strategy will help to shore up business’ operations plan. To initiate regulatory oversight, making synergy between the departments, working on reducing the risk as well as securing the steady money flow are all value neutral approaches.
Value making Strategy
The value creating business strategy is one where business seeks on edge out the competitors just by gaining more of market share. The strategies help to add the real and the perceived value to business’ products as well as services just by exploiting the economies of scope — resources & capabilities of business that are shared over the whole organization to decrease the costs & increase the efficiency. The key idea behind the value making strategy is the diversification: giving more products to many consumers in a market in attempt to dominate different parts of overall share of market.
Deciding on the Strategy
Whereas it at times is very evident which kind of the corporate level strategy the organization must adopt, it’s very less clear at sometimes, mainly when market is totally unsteady or business will not afford to waste the resources trying out new products & services that might not be very profitable. Just asking yourself some strategy level questions will help in your choice: Does my organization feel threatened by the competitors? In case so, the value making strategy is a right direction and does my business have to tighten the resources & monitor the finances very closely? You need to focus on the value neutral strategy. Consider the value reducing strategy.
Value Reducing Strategy
The businesses at times engage in the value reducing strategies. IT happens on the organization level when stakeholders and customers perceive that business is getting very big for the britches or just top level of executives are getting benefit from the diversification. In such case, the value reducing strategy will refocus business’ market, to help it define the target demographic as well as puts the mechanisms in proper place to prevent any unnecessary and harmful growth.
So, in short, it’s necessary for support leadership to get widespread buy-in prior to making decisions that will have the substantial impact. However, customer departments might have other pressing priorities than to engage with support function’s business strategy review.
To finish…
In several ways strategic choices for the support function are little more constrained than for any business unit. However, it needs higher ingenuity to secure the good outcome: addressing complexity to serve different clients sets
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