Intensive Growth Strategies – Expansion through Intensification Intensification involves expansion within the existing line of business. Intensive growth strategy involves safeguarding the present position and expanding in the current product-market space to achieve growth targets. Such an approach is very useful for enterprises that have not fully exploited the opportunities existing in their current products-market domain. A firm selecting an intensification strategy, concentrates on its primary line of business and looks for ways to meet its growth objectives by increasing its size of operations in its primary business. Intensive expansion of a firm can be accomplished in three ways, namely, market penetration, market development and product development first suggested in Ansoff’s model. Intensification strategy is followed when adequate growth opportunities exist in the firm’s current products-market space. However, while going in for internal expansion, the management should consider the following factors. While there are a number of expansion options, Continue reading
Strategic Management
Strategic management is the art and science of formulating, implementing and evaluating cross-functional decisions that will enable an organization to achieve its objectives. It involves the systematic identification of specifying the firm’s objectives, nurturing policies and strategies to achieve these objectives, and acquiring and making available these resources to implement the policies and strategies to achieve the firm’s objectives. Strategic management, therefore, integrates the activities of the various functional sectors of a business, such as marketing, sales, production etc. , to achieve organizational goals. It is generally the highest level of managerial activity, usually initiate by the board of directors and executed by the firm’s Chief Executive Officer (CEO) and executive team.
Ashridge Portfolio Matrix
Corporate Parenting is a strategy employed by highly centralized and diversified firms with large resource pools. It views the corporation in terms of resources and capabilities that can be used to build business units value as well as generate synergies across business units. Corporate parenting generates corporate strategy by focusing on the core competencies of the parent corporation and on the value create from the relationship between the parent and its businesses. There are basically three styles of corporate parenting as follows; financial control, strategic planning and strategic control. Financial Control: Under this style the role of the corporate parent is to monitor and evaluate the financial performance of investment portfolio of the respective business units. The corporate managers act as agents on behalf of share holders and financial markets to identify and acquire viable assets and businesses. The business unit managers are given the autonomy to carry out business Continue reading
Forecasting for Strategic Planning
Forecasting is a collection of mostly statistical and/or judgmental procedures which aim at predicting the future based on the available information and/or data (These processes may include activities such as data collection, data pre-processing and preliminary data analysis, forecasting method selection, which also involves model selection, model fitting, and diagnostic checking, and control in a forecasting system in use). In such processes, forecasting has lots of potentials for strategic level managers including revealing system dynamics, problem determination, predicting, monitoring, and control. Forecasting techniques are used by managers to plan future capacity to meet market demand and to procure the needed inputs to produce this demand at optimum costs. Forecasting models are used to predict future aspects of business operation. They include averages, moving averages, weighted moving averages, exponential smoothing, linear trend models, and simple and multiple regression models. Forecasting as a Strategic Decision-Making Tool Surviving in highly competitive markets Continue reading