ISA 2

• Business Level Strategy


  The actions and approaches taken by a company to gain a competitive advantage within a specific business or industry
• Corporate Level Strategy


  The overall strategic direction and scope of activities pursued by a corporation to achieve its long-term goals and objectives
• Competitive Approaches


  • Cost Leadership
  • Differentiation
  • Focus or Niche Strategy
• Cost Leadership


  • A strategy focused on achieving the lowest cost of production or operation in the industry while maintaining acceptable quality
• Differentiation


  • This strategy involves creating unique and distinctive products, services, or attributes that set a company apart from its competitors
• Focus or Niche Strategy

  • Companies adopting a focus strategy concentrate on a narrow market segment or niche
• Company employing competitive approaches


  • Google Inc.
• 7S Framework


  • A management model that helps organizations analyze and align various elements of their internal environment to achieve effective organizational performance
• Short-term Goals


  Focus on immediate outcomes and actions, cover a period of 1-3 years, address current challenges and operational efficiency, tactical decisions and day-to-day operations, often financial targets and operational improvements, measurable results within a shorter timeframe, respond to immediate market conditions, proactive problem-solving and short-term decision-making
• Long-term Goals


  Focus on future direction and sustainability, span a period of 3+ years, drive strategic growth and competitive advantage, strategic decisions and future-oriented planning, market expansion, innovation, and capability development, longer time horizon for results and impact, visionary and transformative objectives, shape and influence future market conditions, forward-looking and strategic decision-making
• Sample short-term and long-term goals for Apple Inc.

  • Short-term: Launch a new iPhone model with enhanced features, Increase sales revenue by 10% in the next quarter, Improve supply chain efficiency to reduce costs, Enhance customer satisfaction through improved UX

  Long-term: Develop and dominate the market for augmented reality (AR), Expand into emerging markets, such as India and Africa, Achieve carbon neutrality across the entire value chain, Develop a sustainable and closed-loop product lifecycle
• Vertical Scope


  The range of activities and stages of the value chain in which a company participates
• Vertical Integration


  Expanding the company's operations either upstream (backward integration) towards suppliers or downstream (forward integration) towards distributors or retailers
• Vertical Disintegration


  Outsourcing certain activities or stages of the value chain to external suppliers or partners
• Horizontal Scope


  The range of products, services, or industries in which a company operates
• Narrow or Focused Scope


  Companies concentrate their efforts on a specific product category or a particular market segment
• Broad Scope or Diversification


  Companies engage in diverse product categories or operate in multiple markets or industries
• Factors influencing make vs. buy decisions

  • Cost Consideration
  • Core Competencies and Strategic Focus
  • Capacity and Resources
  • Quality and Control
  • Time-to-Market and Flexibility
  • Risk Management
  • Strategic Partnerships
• Corporate Diversification


  Expanding a company's activities into new products, services, markets, or industries that are distinct from its existing operations
• Benefits of Corporate Diversification

  • Risk Reduction
  • Synergy and Economies of Scope
  • Growth Opportunities
  • Competitive Advantage
  • Resilience to Market Volatility
• Costs of Corporate Diversification

  • Lack of Focus
  • Increased Complexity
  • Integration Challenges
  • Financial Risk
  • Reduced Specialization
• Diversifying a business involves expanding into new products, services, markets, or industries, while entering a new industry focuses on establishing operations in a completely different sector
• Strategic planning provides a roadmap for organizations to achieve their long-term goals and objectives
• Strategic planning involves analyzing the internal and external environment to identify opportunities and challenges
• Strategic planning helps align organizational efforts and resources toward a common purpose
• Strategic planning requires setting clear objectives and formulating strategies to achieve them
• Regular monitoring and evaluation of progress are essential for effective strategic planning
• Strategic planning fosters a proactive and forward-thinking mindset, promoting innovation and adaptability
• Communication and engagement with stakeholders are crucial for successful implementation of strategic plans
• Corporate Level Strategy


  The overall strategic direction and scope of activities pursued by a corporation to achieve its long-term goals and objectives.