Strategy Hierarchy in Business
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Questions and Answers

Who is responsible for steering the corporate strategy?

  • Top management team (CEO, CFO, etc.) (correct)
  • Heads of functional areas
  • Managers of production facilities
  • Middle management

    • What is the main focus of the business strategy?

  • How to implement a chosen business strategy?
  • How to compete in an industry and market? (correct)
  • How to manage specific industry/market branches
  • How to execute the business and functional area strategy?

    • Which level of strategy is concerned with executing the business and functional area strategy?

  • Operating strategy (correct)
  • Business strategy
  • Functional area strategy
  • Corporate strategy

    • What is the main focus of the functional area strategy?

    <p>How to implement a chosen business strategy?</p> Signup and view all the answers

    Who is responsible for steering the functional area strategy?

    <p>Heads of functional areas</p> Signup and view all the answers

    What is the main focus of the first half of the course?

    <p>Business strategy</p> Signup and view all the answers

    What is the relationship between functional area strategy and other subjects?

    <p>It overlaps with several other subjects</p> Signup and view all the answers

    Who is responsible for steering the operating strategy?

    <p>Middle management</p> Signup and view all the answers

    What is the purpose of decisions to enter or exit markets or products?

    <p>To strengthen market position through differentiation</p> Signup and view all the answers

    What type of actions can help a company defend against external threats?

    <p>Systematic decisions and actions that define a strategy</p> Signup and view all the answers

    What is the purpose of actions regarding R&D, production, sales/marketing, and finance?

    <p>To strengthen or build resources and capabilities</p> Signup and view all the answers

    What is the goal of decisions that strengthen market position?

    <p>To differentiate the company from competitors</p> Signup and view all the answers

    What type of actions can help a company gain market share?

    <p>Actions to reduce costs</p> Signup and view all the answers

    What is the purpose of collaboration with external parties?

    <p>To strengthen or build resources and capabilities</p> Signup and view all the answers

    What type of decisions help a company seize opportunities?

    <p>Decisions to identify and seize opportunities</p> Signup and view all the answers

    What is the goal of systematic decisions and actions?

    <p>To define a strategy</p> Signup and view all the answers

    What is the primary focus of the 'Actions to gain market share by reducing costs' strategy in the business of Padel?

    <p>Reducing costs to gain market share</p> Signup and view all the answers

    What is the main objective of 'Decisions that strengthen market position'?

    <p>To strengthen market position through M&amp;A</p> Signup and view all the answers

    What is the primary focus of 'Actions to strengthen, build, or obtain resources and capabilities'?

    <p>Strengthening, building, or obtaining resources and capabilities</p> Signup and view all the answers

    What is the main objective of 'Decisions to enter or exit markets or products'?

    <p>To enter or exit markets or products</p> Signup and view all the answers

    What is the primary focus of 'Actions to strengthen the bargaining position with suppliers'?

    <p>Strengthening the bargaining position with suppliers</p> Signup and view all the answers

    What is the main objective of 'Collaboration/Alliances with external parties'?

    <p>To collaborate with external parties</p> Signup and view all the answers

    What is the main objective of 'Actions regarding R&D, production, sales/marketing, finance, and other core activities'?

    <p>To manage core activities effectively</p> Signup and view all the answers

    What is the main objective of 'Actions to identify and seize opportunities, and to defend against external threats'?

    <p>To identify and seize opportunities, and to defend against external threats</p> Signup and view all the answers

    What is a key aspect of a company's values?

    <p>Guiding management and employee behavior</p> Signup and view all the answers

    What is the primary purpose of a clear vision?

    <p>To determine the company's purpose and direction</p> Signup and view all the answers

    What is included in a company's external environment?

    <p>The competitive environment</p> Signup and view all the answers

    What is the role of strategic analysis in the strategy process?

    <p>To analyze the internal and external environment</p> Signup and view all the answers

    What is an example of a core value?

    <p>All of the above</p> Signup and view all the answers

    What is the purpose of a company's vision?

    <p>To determine the company's purpose and direction</p> Signup and view all the answers

    What is included in the internal environment?

    <p>Internal resources and capabilities</p> Signup and view all the answers

    What is the relationship between a company's vision and its objectives?

    <p>The vision determines the objectives</p> Signup and view all the answers

    What is the relationship between intended strategy and realized strategy?

    <p>Realized strategy is a combination of intended and emergent strategy</p> Signup and view all the answers

    What is the focus of Honda's US-market expansion in the 1950s and 1960s?

    <p>Focus on 250 and 305 CC engines for mainstream market</p> Signup and view all the answers

    What is the characteristic of the emergent strategy?

    <p>It is a continuous and adaptive approach</p> Signup and view all the answers

    What is the main difference between intended strategy and emergent strategy?

    <p>Intended strategy is a top-down approach, while emergent strategy is a bottom-up approach</p> Signup and view all the answers

    What is the outcome of Honda's strategy shift in the US market?

    <p>Honda's sales increased significantly</p> Signup and view all the answers

    What is the role of values, vision, mission, and goals in the strategy process?

    <p>They are the inputs to the strategy process</p> Signup and view all the answers

    What is the basis of coordination in the emergent strategy?

    <p>Coordination based on adaptation and spontaneous interventions</p> Signup and view all the answers

    What is the characteristic of the realized strategy?

    <p>It is a combination of proactive and reactive elements</p> Signup and view all the answers

    Study Notes

    Strategy Hierarchy

    • Corporate strategy: how to compete in an industry and market, steered by top management team (CEO, CFO, etc.)
    • Business strategy: how to implement a chosen business strategy, steered by management of specific industry/market branches of a company
    • Functional area strategy: how to execute a business strategy, steered by heads of different functional areas (e.g., R&D, marketing, supply chain)
    • Operating strategy: executes the business and functional area strategy, steered by middle management (e.g., managers of production facilities)

    Strategy Process

    • Successful strategy: effective implementation of a clear vision, values, and mission
    • Values: norms, traits, and beliefs expected of management and employees, serving as a guideline for adhering to the company's vision and mission
    • Vision: management's aspirations for the future, setting the course and direction for the long term
    • Mission: a clear and concise statement of the company's purpose and objectives
    • Goals: simple, consistent, and long-term objectives

    Strategic Analysis

    • Internal and external environment analysis: understanding the company's strengths, weaknesses, opportunities, and threats
    • Intended strategy: top-down, cyclical, predetermined, and limited involvement of the organization
    • Emergent strategy: bottom-up, continuous, adapted, and extensive involvement of the organization
    • Realized strategy: partly proactive (intended) and partly reactive (emergent)

    Examples

    • Honda's US-market expansion: initially focused on 250 and 305 CC engines, but adapted to focus on 50CC engines and the mainstream market through major retailers
    • Other examples: (no specific details provided)

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    Quiz Team

    Description

    This quiz covers the different levels of strategy in a business, from corporate to operating strategy, and how they are steered by different management teams.

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