Corporate Strategy As An Effective Tool For Organizational Survival

Corporate Strategy As An Effective Tool For Organizational Survival (A Case Study Of Mtn Nigeria Owerri Imo State)

CHAPTER 2

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Concept of Corporate Strategy

Tiles (1979) defines corporate strategy as “the set goals and major policies of an organization” . This definition encompasses the basis objectives of the organization and the major means that will employed to reach those objectives, in essence corporate strategy determines what the basic nature of the entity is or will be and further it determines how the entity has reached or will reach that state of being.

In the views of Schendel et al as quoted by McCarthy (1979) corporate strategy is define as the basis goals and objectives of the organization, the major programme of actions chosen to reach these goals and objectives and the major patterns of resources allocation used to relate the organization to its environment.

In the words of Chambler (1962, p.8) “Corporate strategy is the determination of basis long range goals and objectives in an enterprises and the allocation of resources necessary for carrying out this goals.

However, Ansoff (1965) proposed a concept of corporate strategy which provides a board concept of a firm’s business, set forth specific and supplements the firms objectives with decision rules which narrows firm’s selection process to the most attractive opportunities.

This concept of strategy seems to separate strategy from objects. However, the employment of strategy to attain objective are presented as separable in nature, they are recognized as necessary complementary in operation.

According to Thompson (1996, p. 34) a company’s strategy is the “Game plan” management has for positioning the company in its chosen market arena, competing successful pleasing. Customers and achieving good business performance.

From this perspective, corporate strategy consist of the whole array of competitive moves and business approaches that mangers employs in running a company.

Here, in crafting a strategic course, managements is saying that “Among all the paths and actions we could have chosen what we have decided to go in this direction and rely upon. These particular ways of doing business.” A strategy thus entails managerial choices among alternative and signals organizational commitment to specific markets, competitive approaches and ways of operating.

Approaches of Corporate Strategy Making Task

Companies and managers go about the task of making corporate strategy differently. In small owner managed companies strategy making usually occurs informally emerging from experiences, personal observation and assessment, verbal exchange and debates and entrepreneurial judgment of a few key people at the top. Often, the resulting strategy exists inwardly in the entrepreneur’s own mind and in oral understandings with key subordinates, but is not reduced to writing and levied out in a formal document.

Large companies, however tend to develop their strategies more formally (occasionally using prescribed procedures, forms and time table) and in deeper details.

There is often considerable data gathering situation analysis and numerous meeting to probe, question, sort things out and hammer out the pieces of the strategy, the larger and more diverse an enterprise, the move manager feel it is better to have a structural process with timetable, studies debate and written plans than receive officials approval from up the line.

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However, whether in a small or large company, there are essentially four approaches to strategy formation.

  1. The Master Strategist Approach: Here some managers takes on the role of chief strategist and chief entrepreneur, single-handedly exercising strong influence over assessment of situations, strategy alternative that are explored and over the detail of the strategy. The manager in this case does not personally do all the work, he only assumes the position of the chief Architect of strategy and wields a proactive hand in shaping some or all the major pieces of the strategy. Master strategies act as strategy commanders and have a big ownership stake in the chosen strategy.
  2. Delegate-it–to –others approach: The manager delegate pieces and may be all the strategies making task to others, perhaps on group of trusted subordinate, a cross functional task force or self-directed work teams with authority over a particular process of function.

The manager then personally stays in touch with how the strategy deliberate are progressing, offer guidance, when appropriate and reserve final approval; until the strategy proposals are formally presented, considered, modified and ready for implementation while strategy delegates may leave little of own imprint on individual pieces of the strategy proposals presented for approval, they often must still play an integrative role in bringing the separated strategy elements devised by others into ceremony in flushing out any pieces not delegated. This strategy making approach makes for broad participation and input from many managers.

  iii. The Collaborative Approach: This is a middle approach whereby the manager enlists the help of key peers and subordinate in hammering out a consensus strategy, the strategy that emerges is the joint product of all concerned with the collaborative effort usually being led personally by the manager in charge. The collaboration approach is suited to situation where strategic issue cut across traditional functional department lines and problem solving skills of people with different backgrounds, expertise and perspective and where it makes sense to give as many as feasible a participative role in shaping the strategy that emerges and help with their wholehearted commitment to implementation.

  1. The Champion Approach: In this style, the manager is interest in a big personal stake in the details of strategy nor in the time-consuming task of leading other through participative brainstorming or collaborate “group wisdom” exercise. Rather the idea is to encourage individuals and teams to develop, champion and implement sound strategies on their own initiative. There important pieces of company strategy originate with the doors and the fast-trackers. Executives save as judges, evaluating the strategy proposals needing their approach with this approach, the total strategy end up being the sum of the championed initiatives that gets approved. The approach workers will in large diversified corporations where the chief executive officer cannot personally making in each of many business divisions.

These four basis managerial approaches to forming corporate arrive at a planned strategy, when the manager in charge personally functions as the chief architect of strategy, the choice of what strategy, course to steer is a product of his/her own vision about how to position the enterprise and of the manger’s ambitions, values, business philosophies and entrepreneurial judgment about what moves to make next. Highly centralized strategy making works fine when the manager in charge has a powerful insightful vision of where to head and haw to get there. There primary weakness of the master strategic approach is that the caliber of the strategy depends so heavily on one’s person’s strategy making skills and entrepreneurial acumen. It also breaks down in large enterprises where many strategic initiatives are needed and strategy making task is too complex for one person to handle alone.

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Other times, it represent political consensus with outcome shaped by influential subordinates, by powerful functional departments or by majority conditions that have a common interest in promoting their particular version of the strategy ought to be politics and exercise of power are most likely to come into play in situations where there is no strong consensus on what strategy to adopt.

The big weakness of a delegate-it-to others approach is the potential lack of sufficient to-down direction and strategic leadership. The collaborative approach is conductive to political strategic choice as well, since powerful departments and individuals for their favored strategic approach.

Corporate Strategy Process

From all the foregoing, it is obvious that corporate strategy is a process comprising the following basic terms

-Forming a strategic vision of what the company’s future business make up will be and where the organization is headed.

-Setting objectives

-Crafting a strategy to achieve the desired outcomes

-Implementing executing the chosen strategy efficiently and effectively.

-Evaluating performance and initiation corrective adjustments in vision, long term directions, objectives, strategy or implementation in light of actual experience changing conditions, new ideas opportunities.

These basic task are considered in terms below:

  1. i. Developing a strategic vision and corporate mission.

The starting point in the corporate strategy process is for managers to pose the issue of “That is our vision for the company-where should the company be headed, what kind of enterprise are we trying to build, what should the company’s future business and form a clear sense of weather and how it needs to change over the next 5 to 10 years. Management’s view about “where we plan to go from here, what business we want to do in other to satisfy, what capabilities we are going to develop.

What a company is currently seeking to do for its customers is often termed the company’s mission. There is a greater management imperative to considered what the company will have to do to meet customers’ needs tomorrow and weather and how the company’s business make up will have to evolve for the company to grow and prosper. Thus, mangers and obligated to look beyond the present business mission and think strategically about the impact of new technologies and expectations, the emergence of new market and competitive condition e.t.c they have to make some fundamental choices about where they want to take the company and from a vision of the king of enterprise they believe the company need to be.

  1. Setting Objectives

The purpose of setting objectives is to convert managerial statement of strategic vision and business mission into specific performance targets, the organization’s progress can be measured by successful managers set company’s performance targets that required stretch a lot of disciplined effort. Setting objectives that require a lot of disciplined effort. Setting objectives that are require real organizational performance. There performance objectives setting are required of all mangers. Every unit in a company needs concrete, measurable performance target that contribute meaningfully toward achieving company objectives. The ideal situation is a team effort where each organizational unit strives to produce result in its area of responsibility that contributes to the achievement of the company’s performance targets and strategic vision.

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iii.  Crafting Strategy to Achieve the Desired Outcome.

A company’s strategy respondents management’s answer to such business issues as whether to concentrate on a single business, whether to cater to a broad range of customers or focus on a particular market niche, whether to develop a wide or narrow product line, whether to pursue a competitive advantage based on low cost or product superiority or unique organizational capabilities how to react to new market and competitive conditions and how to grow the enterprise over a long term.

A strategy thus reflects managerial choices among alternatives and signals organizational commitment to particular products, markets, competitive approaches and ways of operating the enterprise.

Crafting a winning strategy needs to be a to priority managerial task in every organization. To begin with there is a compelling need for managers to be well fashioned rather than another strategy making in this context brings. Into play the critical managerial issues to achieve targeted result in light of organization’s are sufficiently uncertain than managers cannot plan strategic action in advance and pursue a pre-planned or intended strategy without many need for alternations.

Company strategies end up, therefore being a composite of planner actions and business approaches and as-needed reactions to unforeseen conditions, consequently corporate strategy is best looked upon as being a combination of planned actions and on the-spot adaptive reactions to freshly developing industry and competitive events. Strategy making pyramid.

In large enterprises, decision about what business approaches to take and what new moves to make involvement senior executive in the corporate office, heads of business units and product decisions, the head of major functional areas within a business or division  (manufacturing , marking  and sales, finance, human resource etc.)

In diversified enterprise, strategies are initiated at four distinct organization levels. There is a strategy for the company and all of its business as a whole (corporate strategy). There is a strategy for each separate business the company has diversified into (business strategy)then there is a strategy for each specific functional unit within a business (functional strategy), each business usually has a production

Corporate Strategy As An Effective Tool For Organizational Survival (A Case Study Of Mtn Nigeria Owerri Imo State)

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