who among the following is responsible for making business strategies in a large conglomerate? This is a topic that many people are looking for. star-trek-voyager.net is a channel providing useful information about learning, life, digital marketing and online courses …. it will help you have an overview and solid multi-faceted knowledge . Today, star-trek-voyager.net would like to introduce to you Corporate vs. Business Strategy. Following along are instructions in the video below:
This strategy. Learning content is brought to you by the marriott school of business and and the center for teaching and learning at brigham young university. The purpose of this is to briefly explain the difference between business and corporate strategy at the highest level.
We think of a business as a unit that provides a product or service in a particular market and we think of a corporation as a family of businesses. That is a set of units under a single corporate umbrella for business strategy. We analyze one specific unit with four key questions.
One where do we compete to what unique value do we offer to customers three how do we deliver that value and four how do we sustain our ability to deliver that value so. For example. Jay dogs is a favorite local restaurant close to the campus of brigham.
Young university founded by a former byu student. Who had the idea to place a simple hot dog stand close to campus with high quality. Dogs and a special sauce jay dogs competes in the fast food space within walking distance of byus campus customers choose jay dogs over other fast food options due to its convenience connection to byu quality and taste.
Jay dogs delivers this value through a unique history with a byu student founder intellectual property in its special sauce a unique brand and relationships with high quality vendors. This is a simple business. A single unit that targets.
A single market with a simple set of products and clearly defined unique value in contrast corporate strategy considers the set of businesses. We have in our corporation and how they may or may not work together lets imagine a corporation that owned jay dogs along with a hotdog manufacturer and an event planning company. The hotdog manufacturer is likely a supplier of the jay dawgs restaurant.
You can see that this is a different business by looking at who the buyers are for these two businesses and consumers buy from jay dogs when they are hungry. But restaurants and retail outlets buy from a hotdog manufacturer. When they need hotdogs to sell the hungry.
Customers and consumers want hot. Tasty food right. Now from a brand.
They trust. While restaurants and retail outlets. Want high quality hotdogs that they can store safely and easily.
Until needed for resale. One business focuses on food preparation for customers. And the other focuses on food logistics and storage.
These businesses are related because they both deal with hot dogs. But since they have fundamentally different customers with fundamentally different needs. We see that there are different business units.
The hotdog manufacturer for example might choose to sell dogs to many restaurants and retail outlets. Even though. The same corporation owns both businesses.
The fact that the manufacturer is a supplier to j dogs makes this a form of vertical integration meaning. A company owns more than one stage in a products value chain.
The event planning company also targets a very different customer than j dogs it helps individuals and organizations plan large events. What part of these events may be catering food. If the events are casual get togethers or tailgating parties before sports events.
Then j. Dogs might be an ideal food vendor. If the events are formal such as weddings or awards ceremonies then event planners may prefer more formal sit down meal services that j dogs cannot provide in this case.
Again these two different businesses have two very different sets of customers even though they are part of the same corporate family. We would think of these two as being somewhat unrelated businesses in a diversified corporate portfolio. It should be clear that these three businesses need very different business strategies in order to serve very different customers who demand different unique value in different external environments understanding.
This is important because we would perform business strategy audits for each of these businesses. Separately and from a corporate strategy perspective. We would explore questions like what resources do we share across these businesses.
And what resources do we not share how if at all do these units work together do we want each business to maximize its own performance or do we want them to work together as a team to maximize overall corporate performance. Even if it means one or more of these businesses will be less effective than it could be now lets make this a bit more complicated. What if j dogs open j burgers.
A hamburger joint j. Burger likely targets hungry and consumers just like j dogs j. Dogs and j burgers might even consider sharing serving space kitchen space and or employees.
They may be able to leverage. Many resources and capabilities in j. Dogs for j burgers.
And vice versa are these different businesses with different strategies or are they the same business with just two different product lines while we are not aware of any clear lines. We can draw to say definitively whether these are or are not the same businesses. We think the answer depends on the extent of resource sharing between the two businesses.
If we share a hundred percent of our resources. Then these are almost certainly the same business. If we share zero percent of our resources.
Then these are almost certainly different businesses as we lean towards 100 sharing. We likely have a single strategy as we lean towards zero percent. Sharing.
We likely have completely different strategies for each business. When we are in the middle. Things get a bit messy maybe.
50 of our strategy is shared across units and the other 50 is customized to our specific unit. Or maybe. There is a different ideal configuration.
Managing these different configurations is the realm of corporate strategy. One important takeaway is that it is critical to understand how many businesses you are in and how those businesses relate to each other in order to figure out how many strategies you need and how much of your strategy to share across business units music. .
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