Strategic Marketing: Corporate Mission and Strategy
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Questions and Answers

What is the focus of a market-oriented approach?

  • Customer and benefit (correct)
  • Sales and revenue
  • Competitor and market share
  • Industry and product
  • What is the goal of Google's mission?

  • To make information universally accessible and useful (correct)
  • To create a place where America still works as it's supposed to
  • To provide a platform for fantasy and competition
  • To organize the world's information
  • What are the components of an objective in marketing strategy?

  • Performance dimension, measure, and target level
  • Performance dimension, measure, and time frame (correct)
  • Measure, target level, and time frame
  • Performance dimension, target level, and time frame
  • What is the primary purpose of a business portfolio?

    <p>To manage the collection of businesses and products</p> Signup and view all the answers

    Which of the following is a possible measure of innovativeness in marketing strategy?

    <p>% sales from new products introduced in last 5 years</p> Signup and view all the answers

    What is the significance of a time frame in setting marketing objectives?

    <p>It helps in evaluating progress</p> Signup and view all the answers

    What is the primary purpose of a corporate strategy?

    <p>To provide direction on the company's mission and growth policies</p> Signup and view all the answers

    What is the primary benefit of a good mission statement?

    <p>It motivates employees and guides the organization's purpose</p> Signup and view all the answers

    What is the main focus of a business unit strategy?

    <p>Allocating resources to specific business units</p> Signup and view all the answers

    What is the primary goal of a marketing strategy?

    <p>To provide direction on the company's marketing tactics</p> Signup and view all the answers

    What is the main focus of functional planning?

    <p>Providing direction on the company's marketing and other functional tactics</p> Signup and view all the answers

    What is the Business Domain Choice framework used for?

    <p>To identify growth opportunities and define the company's business domain</p> Signup and view all the answers

    What type of businesses are associated with negative cash flow?

    <p>Low-share businesses in low-growth markets</p> Signup and view all the answers

    What is the purpose of the 'Harvest' strategy for an SBU?

    <p>To milk short-term cash flow</p> Signup and view all the answers

    What is the limitation of the BCG Matrix in terms of planning?

    <p>It provides little advice for future planning</p> Signup and view all the answers

    What is the 'Build' strategy for an SBU?

    <p>To invest more to increase market share</p> Signup and view all the answers

    What is the characteristic of a 'sick' portfolio in the BCG Matrix?

    <p>Low-share businesses in low-growth markets</p> Signup and view all the answers

    Which of the following is an example of a 'Hold' strategy in Unilever's portfolio?

    <p>Marmite and Hellmann's</p> Signup and view all the answers

    What is a limitation of the BCG model?

    <p>It assumes that all business units are independent of one another except for the flow of cash.</p> Signup and view all the answers

    What is the primary objective of market penetration strategies?

    <p>To increase market share.</p> Signup and view all the answers

    What type of diversification involves expanding into unrelated businesses?

    <p>Conglomerate diversification</p> Signup and view all the answers

    What is the primary goal of product development strategies?

    <p>To increase the number of products offered.</p> Signup and view all the answers

    What is the primary benefit of market penetration strategies?

    <p>Low risk, low return.</p> Signup and view all the answers

    What is the focus of market development strategies?

    <p>Expanding markets for existing products.</p> Signup and view all the answers

    What is a characteristic of a Strategic Business Unit (SBU)?

    <p>It has its own set of competitors</p> Signup and view all the answers

    What is an ideal characteristic of a Strategic Business Unit (SBU)?

    <p>A homogeneous set of markets to serve with limited number of related technologies</p> Signup and view all the answers

    What is the responsibility of leaders in a Strategic Business Unit (SBU)?

    <p>Strategic planning, profitability, and efficiency</p> Signup and view all the answers

    What is the purpose of a mission statement?

    <p>To serve as a guiding principle for the company's actions</p> Signup and view all the answers

    What is a characteristic of a well-defined mission statement?

    <p>It is unique to the company and its product-markets</p> Signup and view all the answers

    Study Notes

    Low-Growth Markets and Business Unit Strategies

    • Low-share businesses in low-growth markets have low or declining market share and are associated with negative cash flow.
    • Strategies that can be followed for each SBU:
      • Build: Invest more
      • Hold: Invest enough to hold current position
      • Harvest: Milking short-term cash flow
      • Divest: Phasing out

    Growth-Share Matrix

    • Helps to analyze a company's portfolio of businesses
    • Provides a framework for evaluating the strength of each business unit
    • Examples of companies that have used the BCG Matrix: Unilever

    Limitations of the BCG Matrix

    • Difficult to implement, especially when defining SBUs and measuring market share and growth
    • Classifies current businesses but provides little advice for future planning

    Corporate Strategy

    • Hierarchical nature of strategy: Corporate, Business Unit, and Functional
    • Frameworks for corporate strategy:
      • Business Domain Choice: What is our business? What will be our business? What should be our business? What can be our business?
      • Growth Opportunity Matrix: Evaluates business units based on market growth rate and relative market share

    Corporate Mission

    • Statement of the organization's purpose
    • Serves as a guide for what the organization wants to accomplish
    • Characteristics of a good mission statement:
      • Market-oriented rather than product-oriented
      • Realistic and specific
      • Fits the environment, based on company competencies
      • Motivating for employees

    Examples of Mission Statements

    • Google: To organize the world's information and make it universally accessible and useful
    • Southwest Airlines: To provide a low-cost, high-quality service to customers

    Goals and Objectives

    • Components of an objective:
      • A performance dimension
      • A measure or index for evaluating progress
      • A target level to be achieved
      • A time frame within which the target is to be accomplished
    • Examples of performance criteria:
      • Growth
      • Competitive strength
      • Innovativeness

    Business Portfolio

    • The collection of businesses and products that make up the company
    • Limitations of the BCG Matrix:
      • Too simplistic
      • May be risky to take immediate decisions/actions
      • Assumes business units are independent of one another except for the flow of cash

    Growth Opportunity Matrix

    • Evaluates business units based on market growth rate and relative market share
    • Strategies for growth:
      • Market penetration
      • Market development
      • Product development
      • Diversification

    Strategic Business Units (SBUs)

    • A single business or collection of related businesses
    • Characteristics of SBUs:
      • A homogeneous set of markets to serve with limited number of related technologies
      • A unique set of product-markets
      • Responsibility for their own profitability

    Exercise: Identifying SBUs

    • Example: Which SBUs would you identify in a company?
    • Why?
    • What mission would you write for each SBU?

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    Description

    Test your understanding of corporate strategy and its hierarchical nature, including corporate mission, business unit strategies, and functional decisions. Learn how to analyze a company's scope and resource deployments across its divisions or businesses.

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